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Kentucky’s jobless rate dropped to 8.1 percent last month

Kentucky’s seasonally adjusted preliminary unemployment rate dropped to 8.1 percent in December 2012 from a revised 8.2 percent in November 2012, according to the Office of Employment and Training (OET), an agency of the Kentucky Education and Workforce Development Cabinet.

The preliminary December 2012 jobless rate was .9 percentage points below the 9 percent rate recorded for the state in December 2011.

The U.S. seasonally adjusted jobless rate remained at 7.8 percent from November 2012 to December 2012, according to the U.S. Department of Labor.

Labor force statistics, including the unemployment rate, are based on estimates from the Current Population Survey of households. It is designed to measure trends rather than to count the actual number of people working. It includes jobs in agriculture and those classified as self-employed.

In December 2012, Kentucky’s civilian labor force was 2,091,629, an increase of 6,142 individuals compared to the previous month. Employment also grew with the addition of 6,961 jobs.

“The expansion of the labor force means people are re-entering the job market because they see opportunities. In December, and for three of the last four months, new job growth has outpaced the entrants to the job market, driving down Kentucky’s unemployment rate,” said economist Manoj Shanker of the OET.

In a separate federal survey of business establishments that excludes jobs in agriculture and people who are self-employed, Kentucky’s seasonally adjusted non-farm employment decreased by 4,400 jobs in December 2012 from the previous month. On an over-the-year basis, the state’s non-farm employment has grown by 1.6 percent with the addition of 29,000 jobs.

Nonfarm data is provided by the Bureau of Labor Statistics’ Current Employment Statistics program. According to this survey, four of Kentucky’s 11 major nonfarm North American Industry Classification System (NAICS) job sectors registered gains in employment, while six declined and one remained the same.

Kentucky’s leisure and hospitality sector grew by 1,100 jobs in December 2012. Since December 2011, the sector has expanded by 7,700 positions. This sector includes arts, entertainment, recreation, accommodation and food services.

“Accommodation and food services comprise 90 percent of this classification. This component posted job gains of 1,600 from a month ago,” Shanker said.

The educational and health services sector gained 500 jobs in December 2012. The sector has posted a decline of 400 jobs since December 2011.

The information sector rose by 400 jobs in December 2012. This segment has 600 more positions compared to December 2011. The industries in this sector include traditional publishing as well as software publishing; motion pictures and broadcasting; and telecommunications.

The financial activities sector added 200 jobs in December 2012. Compared to December a year ago businesses involved in finance, insurance, real estate and property leasing have gained 2,100 jobs.

The number of jobs in the other services sector, which includes repairs and maintenance, personal care services, and religious organizations, remained flat from November 2012 to December 2012. Compared to a year ago, there has been a gain of 1,100 jobs.

Employment in the mining and logging sector fell by 100 positions in December 2012. The number of jobs in this sector has dropped by 1,200 or 5.5 percent since last December.

Kentucky’s manufacturing sector lost 800 jobs in December 2012 compared to the previous month. Since December 2011, employment in manufacturing has increased by 1,400 jobs.

“Manufacturing hiring declined across the board in December compared to the previous month. There were declines in the fabricated metal industries, motor vehicle manufacturing and in apparel. This sector was affected by several companies that had planned week shutdown for retooling and maintenance in December, so it may rebound in January,” Shanker said.

The government sector, which includes public education, public administration agencies and state-owned hospitals, decreased by 800 jobs in December 2012. The sector had 1,200 fewer jobs compared to December 2011.

The construction sector posted a decrease of 1,100 positions in December 2012 from a month ago. Since December 2011, employment in construction has fallen by 2,000 positions or 3 percent.

Kentucky’s professional and business services sector fell by 1,400 jobs from November 2012 to December 2012. This category includes establishments engaged in services that support the day-to-day activities of other organizations, including temporary employment services. Since last December, jobs in the sector have increased by 11,300.

“Overall, professional and business services have grown steadily on a year-to-year basis for over three years. The recent decline is in temporary services which may indicate that employers added more staff than necessary in the fall and are now being more cautious,” Shanker said.

The state’s trade, transportation and utilities sector lost 2,400 jobs in December 2012. This is the largest sector in Kentucky with 377,800 positions, and accounts for about 20 percent of nonfarm employment. Since December 2011, jobs in this sector have increased by 9,600 or 2.6 percent.

“None of the major sub-categories in this sector posted a month-to-month gain in December 2012, though compared to a year ago there was substantial gain in employment,” Shanker said. “For example, retail trade employment was up by 5,500 from the same period a year ago.”

Civilian labor force statistics include nonmilitary workers and unemployed Kentuckians who are actively seeking work. They do not include unemployed Kentuckians who have not looked for employment within the past four weeks.

Kentucky’s statewide unemployment rate and employment levels are seasonally adjusted. Employment statistics undergo sharp fluctuations due to seasonal events, such as weather changes, harvests, holidays and school openings and closings. Seasonal adjustments eliminate these influences and make it easier to observe statistical trends. However, because of the small sample size, county unemployment rates are not seasonally adjusted.

Staff Report.