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Indiana's Unemployment Rate Falls, But So Does The Number of Workers

Workers get information about job openings at a drive-thru employment fair in Elkhart during the pandemic.

Workers get information about job openings at a drive-thru employment fair in Elkhart during the pandemic. (Justin Hicks/IPB News)

Indiana’s unemployment rate fell to 5 percent, continuing an encouraging downward trajectory since the start of the pandemic. But the number of people in the labor force is falling too – and that’s not a good sign.

Let's start with the good news: According to the Bureau of Labor Statistics, 18,000 Hoosiers found jobs in October, driving down the unemployment rate more than 1 percent. Those jobs were mostly in trade, transportation, and utilities or in professional business services. Workers even found jobs in leisure and hospitality – a sector that’s been hit hard by the pandemic. 

Now, the not-so-good news: Around 7,000 people left the labor force altogether. That means they’re no longer looking for work. And that number has been steadily shrinking each month since August. 

Kyle Anderson, economist at the IU Kelley School of Business in Indianapolis, has been watching new applications for unemployment benefits rise over the past few weeks. He said the drop in the unemployment rate should be tempered with plenty of caution. 

“I think that’s a more current indicator that says that this kind of 'good news' report that we just got is not going to last,” he said. “We’re going to see more challenges.”

As Indiana heads into the winter months with COVID-19 cases skyrocketing, he said only time will tell how the economy – and unemployment rates – respond.

"I'm concerned about – when you kind of dig down into the numbers – is the unemployment rate going to keep trending down or are we looking at a little bit of a bounce back up?” he said. “I’m concerned it’s going to be a bounce back up.”

Minnesota is now the only state in the Midwest to have an unemployment rate lower than Indiana’s. 

Contact reporter Justin at jhicks@wvpe.org or follow him on Twitter at @Hicks_JustinM.

For the latest news and resources about COVID-19, bookmark our Coronavirus In Indiana page here.

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