Analysis: Kansas will take 3 years to recover jobs
It will take Kansas three more years to fully recover the jobs lost in the Great Recession that started in 2008, according to a recent national economic analysis.
“It’s a very slow-moving economy right now,” said Bob Tomarelli, an economist at Massachusetts-based IHS Global Insight, which conducted the state-by-state study.
He said the projected recovery in Kansas matches the median time frame among all states — the fourth quarter of 2014 — mostly because the state didn’t experience as drastic of unemployment drops as states crippled by manufacturing job losses, such as Michigan and Ohio, or by the real estate bubble, such as California, Nevada and Florida.
But it also is not projected to recover as quickly as the Dakotas, Nebraska and Texas. North Dakota is gaining energy jobs from an oil boom, for example, and Texas is projected to return to its “pre-recession employment peak” in 2012.
The Kansas Department of Labor’s September estimate put the state’s unemployment rate at 6.6 percent, down from 6.9 percent in August. The seasonally adjusted unemployment rate was 6.7 percent, unchanged from August and down from 7 percent one year ago. According to the Bureau of Labor Statistics, the state’s unemployment rate reached a high of 7.6 percent in August 2009.
State labor officials last month warned job growth was still both tentative and anemic. The September jobless rate was 6.3 percent in Lawrence and 5.9 percent overall in Douglas County. The state is scheduled to release its October report next week.
Donna Ginther, a Kansas University economics professor, said compared with the Dakotas and Nebraska, Kansas is more dependent upon manufacturing, especially aviation production in the Wichita area.
“General aviation is a luxury good for businesses and people,” said Ginther, who is also director of KU’s Center for Science, Technology and Economic Policy. “As long as the stock market is gyrating and there’s a lot of uncertainty about future economic growth, it’s going to be slow to recover.”
Some areas in western Kansas have a much lower unemployment rate than the state average, likely because of their dependence on agricultural and energy sector jobs. Ellis, Finney, Ford and Seward counties all had September jobless rates below 5 percent, for example. But Ginther said agriculture and energy sectors typically don’t employ the same volume of workers the manufacturing and construction sectors do, making it more likely statewide the recovery will still take years.
Because the recession and financial crisis hit the state and nation so hard, it has likely increased public frustration for a quicker recovery, she said. Plus, there’s uncertainty surrounding the debt crisis in Europe along with an ongoing fiscal debate in Washington, D.C.
“Low growth is not much better than a recession,” Ginther said, “and that’s just where we are.”