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Recession devastating ohio jobs Original Source Link: (May no longer be active)
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Recession devastating to Ohio jobs
08/31/03
Becky Gaylord
Plain Dealer Reporter
The recession in Ohio over the past two years had a bigger effect on the number of jobs and on unemployment rates than on wages.
Ohio lost substantially more jobs than the nation as a whole, especially in manufacturing, and the state fared worse than it did after the recession in the early 1990s, a study issued today shows.
And output, a reflection of the economy's health, fell faster in Ohio than in 43 other states, according to the report from Policy Matters Ohio.
Kenneth Mayland, president of ClearView Economics in Pepper Pike, said that trend is likely to continue because census data show Ohio is losing population to other states.
That reduces demand for goods and services.
"It's such a headwind, it's next to impossible to overcome," Mayland said.
Despite the recent recession, however, wages in Ohio didn't lose ground, according to the report, called The State of Working Ohio 2003.
"The good news about the economic downturn is that it has not resulted in dramatic wage decline, and for some workers, wages have continued to rise modestly," the report said.
Policy Matters Ohio is a nonprofit research institute in Cleveland that addresses issues affecting workers.
The group focused on employment and wage data from March 2001, when the most recent recession officially began, through March of this year.
The state's unemployment rate, which includes people who are not working but are actively seeking jobs, swelled to an annual average of 5.7 percent in 2002 from 4.1 percent in 2000, roughly in line with increases in the national rate. The measure climbed further this year and stood at 6.2 percent in July.
"In terms of job loss, this recession has been worse for the nation than the one that began in July 1990, but it has been significantly worse for Ohio," the study found.
Between the start of the most recent recession and March of this year, payroll employment - the number of people in part- time or full-time work except those who are self-employed - declined by 3.3 percent in Ohio, and by 1.8 percent in the nation. By comparison, two years after the 1990-91 recession started, payroll employment had fallen by less than one percent in both Ohio and the nation.
In the two years after the latest recession began, Ohio's payroll employment declined, as a percentage, more than that of all but six states. In terms of the numbers of jobs lost, "Ohio hemorrhaged 185,000 jobs between 2000 and 2002," said Amy Hanauer, Policy Matters' executive director and one of the authors of the report. "Only California and New York have lost more jobs," she said.
Almost two-thirds of those jobs were in manufacturing, the study said.
Manufacturing's demise in Ohio would have been worse if not for high levels of automobile sales in recent years. Manufacturing of vehicles and equipment is worth more than 4 percent of the value of the state's output, or gross state product, research from the Federal Reserve Bank of Cleveland shows.
Still, the decline in Ohio's manufacturing sector did hurt the gross state product. Output slid 0.9 percent between 2000 and 2001, among the worst drops in the nation. That was the first period in which gross state product didn't grow since 1990-1991, the Policy Matters Ohio study said.
Demand for unemployment benefits reflects the most recent recession's deep impact, as well. Last year, about 35 percent of workers who drew unemployment benefits exhausted them before they found work. That was the highest proportion of out-of-work Ohioans to deplete their benefits in almost 20 years, the report said.
Certain factors, such as education and union membership, have dramatically affected workers' wages in recent years. More than 47 percent of Ohio workers have only a high school diploma or less, compared with 44 percent of the rest of the nation.
Men with a bachelor's degree or more earned almost 2½ times as much as men without a high school diploma. And women with a bachelor's degree or more earned more than twice as much as women without a high school diploma.
A disparity exists, however, among workers of different races and genders with similar educations, the study said. For instance, whites earn more than blacks, and men earn more than women at every educational level. "Nonetheless, all demographic groups can expect wage increases if they obtain additional education," the study found.
Union membership made a difference in wages since the recession began, particularly for black and female workers, the report concluded.
Female union members earned the same median hourly wage as males who are not in a union, and black union members made more than white workers who were not in a union.
To reach this Plain Dealer reporter:
bgaylord@plaind.com, 216-999-5029
© 2003 The Plain Dealer. Used with permission.
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