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Job scene improves, but employment figures deceiving

Certainly, we need some good, solid economic news, so let's start with this:

Hernando's unemployment rate fell to 12.9 percent in April, the lowest level in two years and a full 3 percent below its peak in January 2010. This was also the third straight month of decline, said David Hamilton, operations manager of the Pasco-Hernando Workforce Board.

"We can finally talk about a trend," he said.

Okay, but, really, how good is this news, how solid?

Maybe not very.

The problem is with discouraged workers, the ones who've quit looking for jobs. No doubt you've heard about them before, but in a place where things have been bad for as long as they've been in Hernando (which still has the third-highest unemployment rate in the state) there are a lot of them.

Their numbers are measured by the drop in the total pool of potential employees — the workforce — which is defined as people who are either "working or looking for work," Hamilton said.

He warned me that it's easy to get overwhelmed with numbers, so I'll try to keep this as simple as possible:

Since August of last year, when county's unemployment rate was 15 percent, the size of its workforce has dropped by 1,373.

During that same period, the total number of employed Hernando residents increased by only 153.

You've probably guessed by now what that means: that the seemingly reassuring drop in the jobless rate, probably the most hopeful sign of local economic recovery, is mostly just due to a lot of people giving up.

In fact, Hamilton said, "almost the entire improvement in the unemployment rate can be attributed to discouraged workers."

What would our employment picture look like if we were reducing the jobless rate the old-fashioned way — by creating more jobs?

Well, consider that with the current number of employed residents, it takes more than 500 jobs either in the county or within commuting distance to drop the rate 1 percent.

To bring it down to 8.9 percent, which is hardly ideal, "but would make people smile right now," Hamilton said, "we'd need well over 2,000 additional jobs."

It doesn't seem as though that will happen any time soon, so maybe you can understand why people have stopped trying. The state's formula for figuring the size of the workforce and, indirectly, the number of people who have dropped out of it, considers several factors, including the number of people collecting unemployment and searching the state's job website.

It's complicated, Hamilton said. But when job creation is stagnant and workforce shrinks, this is what you see in the community: more people in what he calls the "gray market," selling goods at flea markets or taking money under the table for home repairs; a few residents turning to crime: some, no doubt, moving away — just what we need in an county with a sky-high rate of vacant homes.

All in all, it's not a picture of a bustling economy, but before I drive more people into the discouragement, I should point out that the April numbers were better. An additional 206 county residents were counted among the working as compared with just the month before. The workforce, meanwhile, declined by only 75.

"We've seen a reversal in the trend," he said. "It appears that when it comes to the unemployment rate, employment is a bigger factor than discouragement."

Of course, it's a measure of the depth of this economic hole, and how long we've been there, that this can seem like good news, Hamilton said.

"I don't think I've ever had to put it that way before."

Job scene improves, but employment figures deceiving 05/21/11 [Last modified: Saturday, May 21, 2011 9:50am]
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