Ohio Legislative Service Commission
Both the labor force participation rate and the employment-population ratio declined
by 0.2 percentage point in August, to 62.7% and 60.3%, respectively. According to the
U.S. Bureau of Labor Statistics, the number of involuntary part-time workers, who work part
time because they were unable to obtain full-time work, was 4.4 million in August, and is down
counted as being in the labor force because they have not actively been seeking work.
30,000 from August 2017. The number of persons marginally attached to the labor force was
.4 million in August; these people wanted work and were available for work, but are not
According to statistics published by the U.S. Bureau of Economic Analysis, real GDP grew
at an annualized rate of 4.2% in the second quarter of 2018, an increase from 2.2% first quarter
growth and the strongest quarter of economic growth since quarter three of 2014. According to
personal consumption expenditure (PCE) data, the service sector grew at its most rapid rate
since quarter one of 2015, and the goods-producing sector also realized steady growth,
particularly in durables. Nonresidential structure investment rose at a 13.2% rate from the
previous quarter, while intellectual property product sales increased at an 11.0% annualized
rate. National defense spending was increased 6% in the last quarter, its largest increase over
the last nine years. After-tax corporate profits increased $69.5 billion in the second quarter to a
record high of $1.97 trillion, reflecting strong demand and the effects of corporate tax cuts.
Growth in this profit measure is reverberating through financial markets. As of the publishing of
this report, the Standard & Poor's 500 stock price index stood near its all-time high closing price
of 2,901.52, which occurred on August 31.
Industrial production rose 0.1% in July after rising 1.0% in June. For all industries, total
industrial production is up 4.2% from July of last year. Private nonresidential fixed investment
rose at an annualized rate of 8.5% in the second quarter of 2018, while residential fixed
investment declined at a 1.6% rate according to GDP data. The FRB Beige Book report indicates
construction and machinery demand remains strong.
The consumer price index rose 0.2% from June to July 2018, and has risen 2.9% from a
year prior. Prices for food consumed at home have increased only 0.4% year to year, while the
average price of gasoline has increased 25.4% from July 2017. The PCE price index, another
well-recognized measure of inflation, rose 0.1% from June to July 2018, and is up 2.3% from
one year ago.
The Ohio Economy
In July, total seasonally adjusted payroll employment in Ohio was 5.62 million, an increase
of 0.14%, or around 7,600 over June employment. The number of unemployed workers was
increased by 5,800 in July, and the unemployment rate rose by 0.1 percentage point to 4.6%.
Strong gains in labor force participation during the summer months are an encouraging sign for
the economy, although the number of unemployed workers has risen in each of the last four
months. Despite more labor market entrants, many employers surveyed by the Cleveland Federal
Reserve still cite a lack of qualified candidates as a primary concern. Chart 6, below, shows trends
in the state's payroll employment and unemployment rate over the last ten years.
In July, employment in goods-producing industries increased by 6,800 to approximately
42,300, with the strongest gains in the manufacturing (+4,700) and construction (+2,200)
industries. A total of 24,800 jobs were added between July 2017 and July 2018, with gains
accruing in manufacturing, construction, and the mining and logging industry.
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