Springfield unemployment rate is low but so are dwindling workforce numbers

Published: May. 12, 2023 at 7:17 PM CDT|Updated: May. 12, 2023 at 7:22 PM CDT
Email This Link
Share on Pinterest
Share on LinkedIn

SPRINGFIELD, Mo. (KY3) - The latest Bureau of Labor Statistics show that the American economy added 253,000 jobs in the month of April, and the unemployment rate ticked down to a historic low mark of 3.4 percent – the lowest since May 1969. The last time the unemployment rate was lower was October 1953.

The Springfield area’s current unemployment rate is even lower at 2.3 percent which is quite a change from the 11.7 percent from April of 2020 when the pandemic resulted in a business lockdown.

But there’s another stat that’s rarely talked about which is a more-telling barometer as to why there are still way more jobs than there are people wanting to fill them.

And that stat is the “labor force participation rate” which is an estimate of the economy’s “active” workforce.

“The labor force participation rate describes what fraction of adults would like to have a job essentially,” explained Darren Page, a Visiting Assistant Professor of Economics at Drury University. “Early in the 2000′s it was about 70 percent and there’s been a steady decline year-after-year to get down to the 63 percent that we have now.”

That decline isn’t just because of people deciding they don’t want to be a part of the daily grind anymore.

“We have a shrinking labor force due to the retirements of Baby Boomers,” said Missouri Job Center Communications Coordinator Katherine Trombetta. “Then we also have generations coming into the workforce that are much smaller than the Baby Boom generation and so that’s creating a deficit.”

On Wednesday, May 17 the Missouri Job Center at 2900 East Sunshine in Springfield will be trying to cut into that deficit by hosting a multi-industry job fair from 1-4 p.m. featuring 36 employers representing a wide range of careers.

“We have manufacturing, construction, IT, the service industry and much more,” Trombetta said. “And when one industry experiences lay-offs or a downturn those other sectors can pick up those job seekers. So we are insulated from a lot of things that happen nationally.”

Another factor in availability of jobs is that Springfield attracts a lot of businesses and individuals who point to the area’s low cost of living as an attractive draw. But the same low cost of living that attracts new employers can also be viewed as a negative because the area’s average hourly wages are lower than the nationwide average, resulting in an exodus of workers moving on to find higher-paying jobs.

For all occupations the Springfield average hourly wage of $23.49 is well below the U.S. average of $29.76.

“In some ways these comparisons come out in the wash,” Page pointed out. “You could move to St. Louis and probably earn a much higher wage. But at the same time you’ll be paying a lot more for things like rent.”

Page was asked if he felt more young people who were looking for alternatives to getting daily jobs might be open to changing their minds.

“The question is, does reality start to set in at some point because we’ve had a steady increase in the inflation rate and if individuals want to keep affording what they’re used to having they may need to find gainful employment,” he said. “To have people permanently withdraw from the labor force at such young ages seems unrealistic. Given the low unemployment rate at the moment it’s actually the perfect time to be graduating college because a lot of businesses are looking to hire and they have openings.”

But there is one looming problem that’s still keeping some people from coming back into the workforce.

“Childcare is the number one issue of why people don’t enter the workforce,” Trombetta said. “We have several childcare deserts around Springfield where there is no daycare center for parents to drop-off their kids. That is an issue that’s being addressed at the local and state level so I look forward to more labor participation from parents when they find these daycare opportunities that are hopefully on the way.”

To report a correction or typo, please email digitalnews@ky3.com