For the Wichita metropolitan area in November 2021, the unemployment rate fell by a large amount, primarily because of a significant decline in the labor force.
Data released today by the Bureau of Labor Statistics, part of the United States Department of Labor, shows a declining employment situation in the Wichita Metropolitan Statistical Area for November 2021. The unemployment fell, but not for positive reasons.
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Total nonfarm employment rose from 287,800 in November 2020 to 296,400 in November 2021, a gain of 8,600 jobs (3.0 percent). (This data is not seasonally adjusted, so month-to-month comparisons are not valid.) For the same period, employment in the nation rose by 4.1 percent. The unemployment rate in November 2021 was 3.5 percent, down from 5.9 percent the same month one year prior.
Considering seasonally adjusted data from the household survey, the labor force fell by 3,886 persons (1.2 percent) in November 2021 from October 2021, the number of unemployed persons fell by 3,644 (22.0 percent), and the unemployment rate was 4.1 percent, down from 5.2 percent in October. The number of employed persons not working on farms fell to 301,723 in November 2021 from 301,965 the prior month, a fall of 242 persons (0.1 percent).
While the unemployment rate fell by a large amount, it is essential to remember it is a ratio between two numbers: the labor force (the number of people working plus those actively seeking employment) and the number of unemployed people. It is a good sign when the unemployment rate falls because more people are working. That is not the case in Wichita, as the number of employed persons fell by a small number. The number of unemployed people fell by a large number. But the number of people in the labor force also fell, and by a slightly larger number, and so the unemployment rate fell.
The statistics don’t tell us why the unemployment rate fell. Perhaps there are 3,644 fewer unemployed persons in Wichita because they all left town, which means they also left the Wichita labor force. In the net, this produces the (nearly) same unemployment rate. So if we see any politicians or bureaucrats boasting of the low unemployment rate for November, let’s ask if they know why.
The following chart of the monthly change in the labor force and employment in Wichita over the past year shows both gains and declines. The rate of change since March had been small as the economy settles into a more stable pattern as Wichita and the nation recovered from the pandemic. But the change for November is much larger.
As of November 2021, the Wichita MSA had 7,138 fewer jobs (2.3 percent) than in February 2020, the last full month before the start of the pandemic, and 34,909 more jobs (13.1 percent) than in April 2020, the first month after the beginning of the pandemic.
The following chart of changes from the same month one year ago shows Wichita now having more jobs than a year ago for the past seven months. The labor force has varied up and down.
The following chart of changes in employment from the same month of the previous year shows the Wichita MSA has mostly tracked the nation’s trend since the pandemic. Since November 2020, however, the recovery in Wichita has been notably slower than for the nation
The following two charts show changes in jobs for Wichita and the nation over longer periods. The change is calculated from the same month of the previous year. For times when the Wichita line was above the nation, Wichita was growing faster than the nation. This was often the case during the decades starting in 1990 and 2000. Since 2010, however, Wichita has only occasionally outperformed the nation and sometimes has been far below the nation.
(For data on all metropolitan areas in the nation, see my interactive visualization Metro area employment and unemployment.)
The link to the archived version of the BLS news release for this month may be found here.