Louisiana News

Louisiana’s unemployment rate doesn’t paint accurate picture

(The Center Square) – A new federal jobs report shows Louisiana’s employment growth in August was negligible despite an outsized drop in the state’s unemployment rate.

“Although Louisiana’s unemployment rate dropped from 6.6 to 6.2 (percent), the reason for this decrease was not because people were finding jobs. Instead, the decrease was driven by people giving up and leaving the labor market all together,” said Eric Peterson, a policy director at the New Orleans-based Pelican Institute. “For every 10 people returning to work in Louisiana, seven have left the labor market.”

Similar to many states, Louisiana has struggled to reach pre-pandemic employment levels. Hurricanes and the COVID-19 delta variant surge have played a role, as have direct payment stimulus checks, expanded federal programs such as the Child Tax Credit expansion and unemployment insurance increases.

According to the U.S. Bureau of Labor Statistics, Louisiana’s civilian labor force decreased by 3,436 people in August and by 30,000 people since August 2020 – a sign the state’s labor market is different than what the official unemployment rate represents.

The civilian labor force is defined as people age 16 and older who are not active duty military members, incarcerated individuals or those living in elder care, health care or institutional facilities.

Louisiana’s employment data comes as the country underperformed as a whole. The Bureau of Labor Statistics reported 235,000 jobs were added to the economy in August, despite expectations of 720,000 new jobs.

The Louisiana Workforce Commission (LWC) said the state remains about 122,000 jobs behind the March 2020 pre-pandemic figure of 1.97 million jobs. With Hurricane Ida disrupting private sector employment since the storm’s Aug. 29 landfall, September figures could be worse.

Weekly unemployment claims have skyrocketed in the wake of Ida. The LWC reported 13,782 new claims for the week ending Sept. 11, the most-recent data available. The agency reported 2,080 new claims for the week before the Category 4 storm.

“These numbers don’t reflect the reality of the situation we find ourselves in today,” LWC Secretary Ava Cates said upon the release of Louisiana’s new jobs data. “People are still suffering after Hurricane Ida, and we are in the middle of hurricane season. We have a lot of work to do to make sure people can still find work in our state and have the money they need to get them through difficult times.”

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