In light of today’s disappoint June jobs report in which the State of Ohio saw for the first time in twenty-two months its unemployment rate go up, I thought I search to see if there was any indication that we should expect July’s jobs report (which we’ll get roughly a month from now) will be any better.
Yesterday, the Associated Press reported that the U.S. Department of Labor released its data for new unemployment claims for the week of July 9th. Here’s what the AP reported said:
The Labor Department said Thursday that Ohio had the nation’s fifth largest increase in applications for unemployment benefits during the week that ended July 9. Sign-ups went up by more than 5,800 in the state due to layoffs in the auto industry and manufacturing.
Last week, claims rose nationwide by 10,000 to a seasonally adjusted 418,000. Applications have topped 400,000 for 15 straight weeks, a sign of sluggish hiring.
Consumers have pulled back on spending this year, besieged by high unemployment, stagnant wages, and high gas prices. That has slowed the economy’s growth.
Again, we see that Ohio’s manufacturing sector (which had been leading Ohio in many way in job growth during the Strickland recovery) is now taking it on the chin.
I’m still trying to find out how Ohio could rank only fifth largest increase in new unemployment claims, and yet constitute 58% of all the new claims total. So I went to the U.S. Department of Labor’s website and got this explanation:
The largest increases in initial claims for the week ending July 9 were in New York (+20,599), Minnesota (+9,681), Michigan (+9,030), Florida (+7,544), and Ohio (+5,839) while the largest decreases were in California (-15,751), New Jersey (-7,486), Massachusetts (-3,008), Illinois (-1,399), and Connecticut (-1,316).
Because California and other States saw larger drops in their claims, we’re still fifth even though we account for 58% of the net increase in claims nationwide. Super. And Minnesota only made the list due to the state government shutdown going on at the time that has now since been resolved. (Note: On Monday, Kasich called Illinois a “god darn cess pool” according to Dispatch reporter Joe Vardon. Illinois is leading the nation in largest drops in their claims. Kasich really has a bad track record of picking economic winning States… see, Florida on the list, for example.)
We’ve gone the entire workday now, and we’ve heard nothing from John Kasich about today’s jobs report. Instead, his communication office is still tweeting and blogging about how great it is that Standard & Poor changed Ohio’s economic outlook from Negative to Stable, as if he had anything to do with it (he didn’t.)
But Kasich may have popped the champagne cork too soon. The main reason the credit rating agencies improved Ohio’s economic outlook is that after fifteen straight months of dropping unemployment and twenty-two months in which it never rose, they became convinced that Ohio had a sustainable economic recovery. BUT they all specifically warned that a slow down in the economy might lead them to return Ohio back to a negative outlook.
In other words, the credit rating agencies changed their rating simply because after two years, the economic data made it hard for them to continue to hold a negative outlook on it. If Ohio continues to have jobs data like it did in June, however, they’ll have the evidence they need to justify why they kept it as a negative outlook as long as they did.
And let’s also keep in mind that Kasich’s “Jobs Budget” is balanced only so long as Ohio’s employment picture continue to improve. If there’s a downturn, or a more than the Kasich Administration expected slow down in the recovery, then the Kasich’s budget develops a massive hold in it.
Ted Strickland left the State with a growing economy after the worse recession since the Great Depression and a nearly $1 billion surplus. Kasich comes in and starts handing out massive tax breaks to the wealthiest Ohioans as the economy goes backslides into, potentially, another recession.
How much more genuflecting do we need to do to Kasich’s god-like “job creators” before they, you know, create jobs?