Two Cleveland-area economists say they fail to see signs of hope for a quick recovery in the local job market.
More than one out of 10 Ohioans remained unemployed in February, according to recently released state figures. The state unemployment rate increased to 10.9 percent in February, up from 10.8 percent in January and December. The unemployment rate has held nearly steady for the past three months, and two local economists said they see little cause for optimism.
The number of unemployed has increased by 99,000 over the past 12 months to stand at 647,000 in February, according to the Ohio Department of Job and Family Services.
The state’s monthly unemployment rate may underestimate the percentage of Ohio’s jobless workers, said George Zeller, an economic research analyst in Cleveland who tracks local jobless statistics for Cuyahoga County commissioners. One reason is that some longtime unemployed workers give up on finding a job and are no longer counted.
Cuyahoga County’s jobless rate in February was 10.5 percent, compared to January’s 10.2 percent. Neighboring Lorain County was at 11.5 percent, which was a half-percent higher than in January. Summit County, which includes Akron, had an 11.6-percent jobless rate in February, compared to 11.7 percent in January.
The county unemployment figures are not adjusted for seasonal fluctuations, while the state unemployment rate is seasonally adjusted. Ohio’s unemployment rate, if it was not seasonally adjusted, would be 11.8 percent, according to the Ohio Department of Job and Family Services.
Zeller described Northeast Ohio’s unemployment situation as “horrible” and “catastrophically bad.”
“There is no sign at all that the job loss has ended here in Ohio, and specifically in Northeast Ohio,” Zeller said.
Cuyahoga County has lost 115,807 jobs since 2000, Zeller said. That amounts to a 14.3-percent decline from the employment that Cuyahoga County used to have. The county, which includes the city of Cleveland, has consistently been losing jobs during the past decade, he said.
“It’s enough people to fill Browns Stadium, also fill up the Q, where LeBron plays, and still have people left over,” Zeller said. “That’s an enormous number.”
“In blue-collar manufacturing jobs, the damage was far worse,” Zeller said. “Cuyahoga County lost 46.2 percent of its manufacturing jobs during the last eight years. That, obviously, has been catastrophic.”
In neighboring Lorain County, employers eliminated 50.4 percent of the manufacturing jobs.
The impact on local economies is devastating, Zeller said.
“In Cuyahoga County alone, that loss was $4 billion,” he said of payroll reductions stemming from job losses during the past decade. “That is a lot of money to be losing in a town the size of Cleveland and in just one county. Statewide, the figure was about $17 billion.”
The loss of wages has left many families facing desperate straits, according to Zeller.
“In addition, the rest of the economy depends on the earnings from employment,” he said. “When people stop collecting paychecks, their income goes down, they quit spending money, the sales tax drops, the income tax drops, and you’ve got a huge government finance problem all over the state, and that’s certainly true in Cleveland.”
Northeast Ohio is facing its worst economic and employment situation since the Great Depression of 1929 to 1941, Zeller said.
Cleveland State University Economist Joel Elvery also found little good news in the latest unemployment figures.
“We’re just in a holding pattern,” Elvery said. “Things aren’t getting worse, but there’s not been any growth to pick up.”
Northeast Ohio has been hard hit by job losses in the manufacturing and finance sectors, both Elvery and Zeller said.
While both economists saw few bright signs, spokesmen for two Cleveland-area employment agencies reported a recent increase in requests for temporary workers.
Both The Reserves Network, an employment agency headquartered in Fairview Park, and Manpower Inc., which operates an office in North Olmsted, said they are receiving additional requests for temporary workers.
“We are seeing a substantial increase in the utilization of what it is we do,” said Brad Qua, vice president of The Reserves Network. “It is widely understood that this is a jobless recovery. Employers have pared down to get the most they can out of as little employment overhead as they can. As business starts to tick up, they would prefer not to hire people permanently.”
Instead, some manufacturers and other businesses are hiring temporary workers who might eventually become permanent employees.
Manpower Inc. released a report March 9 that found that 13 percent of the companies it surveyed in the Cleveland, Elyria and Mentor area plan to hire more employees during the second quarter of 2010, while 8 percent plan to reduce their payrolls. That amounts to a projected 5-percent increase in what Manpower calls its net employment outlook. That compares to a 6-percent decline in net employment outlook that Manpower projected for the first quarter, which ends later this month.