Why the unemployment rate doesn't paint a complete picture of Illinois' economic recovery

Despite shedding 6,900 nonfarm jobs, the Illinois unemployment rate fell to 5.4 percent in September, dropping one percentage point compared to a year ago, according to preliminary, seasonally-adjusted figures released by the U.S. Bureau of Labor Statistics. That’s the lowest the state’s jobless rate has seen since October 2007.

Unemployment rates have fallen significantly in the majority of states across the country, with many seeing their lowest rates since before the height of the Great Recession. In fact, jobless rates in some states like Michigan (5.0 percent), Ohio (4.5 percent) and Texas (4.2 percent) have declined to nearly 15-year lows.

Elected officials often trumpet these statistics as proof their respective economies are recovering. But looking solely at the unemployment rate fails to tell the whole story, particularly in Illinois.

Illinois Department of Employment Security Director Jeff Mays consistently has cautioned against taking the state’s falling unemployment rate at face value, in part because people who have dropped out of the workforce are not reflected in the statistics.

To fully assess the health of the labor market, other key indicators must be taken into consideration, such as the labor force participation rate and employment-to-population ratio, notes Governing Magazine.

Read the rest of this post at Reboot Illinois, where you also can see Governing’s helpful interactive chart that shows how the unemployment rate, labor force participation rate and employment-to-population ratio have changed in Illinois since 1990.

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