The Atlanta Fed's macroblog provides commentary and analysis on economic topics including monetary policy, macroeconomic developments, inflation, labor economics, and financial issues.

Authors for macroblog are Dave Altig, John Robertson, and other Atlanta Fed economists and researchers.

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August 22, 2006

Bad News In The Buckeye State?

The Federal Reserve Bank of Cleveland reports:

Ohio ’s unemployment rate had been declining through much of 2006.  This downward trend halted in July with an increase in the unemployment rate of 0.7 percentage points—leaving the Ohio unemployment rate at 5.8%...

Is there anything in this news that should give us particular pause about the national employment outlook?  Maybe not.  We already knew from the national statistics that weak employment in the transportation sector was one of the key factors behind the weaker than expected growth in nonfarm payrolls in July.  So it was in Ohio as well:

... in the case of Ohio in July, there is quite a lot of evidence pointing to a sharp increase in auto related layoffs.

... the counties which showed the largest increases in their unemployment rates are counties which have large auto assembly of parts supplier operations.

The state employment detail does not, therefore, appear to provide anything new to worry about.  Unless, of course, your fortunes are tied to the auto industry.

August 22, 2006 in Labor Markets | Permalink


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Tracked on Aug 23, 2006 4:17:02 AM


Or if you are not quite sure how the global adjustment process will play out if auto parts production is outsourced to China ... it all works if China continues to accept IOUs in exchange, but it isn't obvious -- at least to me -- what the US is gearing up to produce (goods or services) to pay for existing imports of Chinese-assembled goods, let alone a new surge in Chinese imports ...

It also isn't clear, at least to me, how the US labor market adjustment process will work. the basic pattern til recently has been jobs that disappeared in manufacturing (mostly from rising productivity, tho rising imports also played a role) were offset by job gains in housing and related sectors (contruction, real-estate broker and the like). but that may not continue ... which implies more labor will need to be absorbed into various non-traded services ...

Posted by: brad setser | August 23, 2006 at 11:23 AM

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