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Ind. jobless rate jumps as jobseekers return

March 19, 2013

INDIANAPOLIS (AP) — Indiana’s unemployment rate crept up in January even as more residents re-entered the workforce, according to federal figures released Monday.

The Bureau of Labor Statistics’ monthly report shows unemployment rose to 8.6 percent in January from 8.3 percent the month before. The state added 8,200 private sector jobs and saw its workforce increase by 14,000 as 10,000 residents returned to the job search.

BLS economist Thomas Krolik said states often see a temporary uptick in the unemployment rate after recessions as confidence in the job market improves and people renew their job searches. The unemployment rate counts residents who are actively seeking work and does not include every resident who is out of work.

But state Workforce Development Commissioner Scott Sanders questioned the federal report, saying it probably overstated the state’s unemployment rate. He pointed to a recent change in different BLS measures of employment that he said don’t make sense.

“It’s quite encouraging Indiana seems to be continuing the trend of private sector job growth into 2013,” Sanders said in a statement. “However, it is very confusing when BLS has survey data from 5,000 businesses showing continued increases in employment, while the household survey continues to show employment below what businesses are reporting.”

BLS calculates unemployment using a measure based on responses from households. It uses two measures to track the jobs themselves, asking 5,000 businesses in each state for their payroll information and also tracking the number of jobs filled by each household.

The number of jobs reported by businesses was usually slightly less each month than the jobs reported by Indiana households. But that flipped early in 2012.

The change could mean that before, slightly more people lived in Indiana and commuted to jobs in Illinois, Kentucky or elsewhere, but now there are more jobs in Indiana and commuters trek to them from out-of-state, Krolik said.

“Indiana became relatively more of a hub for jobs and people commuting across state lines,” he said.

Krolik pointed to Washington, D.C., as the best example of that dynamic. Roughly twice as many people commute to jobs from the Washington suburbs in Maryland and Virginia than live and work in the city.

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