ACE Report: NEO goods-producing sector takes biggest jobs hit in June

The regional employment roller coaster continued in June with Northeast Ohio losing 5,518 jobs from the May total, as total private sector employment dropped to a projected 1,167,386 — a 0.47% loss. Looking year-to-year, past the monthly fluctuations, the job loss in the seven-county metropolitan area since June 2016 is 0.02%, or 290 jobs, according to the Ahola Crain’s Employment, or ACE, Report.

The June job loss was heaviest in the goods-producing section, which includes manufacturing and construction — 3,380 jobs lost between May and June versus 2,138 jobs lost in the larger service sector, which accounts for 82% of the private sector jobs tracked in the ACE survey.

Year over year, the goods sector lost 4,912 jobs versus a gain of 4,621 jobs in services.

Jack Kleinhenz, the Cleveland Heights economist who created the ACE Report model, said the losses are not a serious concern.

“Too much should not be made out of June’s decline,” he said. “It does not point to any major concerns for regional growth. The national and regional economies continue to wander forward at a moderate pace.”

Kleinhenz attributed part of the decline to the auto industry, a large employer in the region, and the summer shutdowns of auto plants.

The July 12 Beige Book, the Federal Reserve Bank’s report on the economy, noted that payrolls in the Fourth District, which includes all of Ohio, western Pennsylvania, eastern Kentucky, and the northern panhandle of West Virginia, continued to expand since the last Beige Book report released May 31, although at a slightly slower pace.

Longer term and nationally, Kleinhenz noted that the Institute for Supply Management (ISM) reported the manufacturing sector nationally grew in June and the overall economy grew for the 97th consecutive month. The ISM manufacturing employment index showed a 3.7% increase over May.

“The labor market remains very healthy and continues to show the confidence in workers willing to leave one job for another,” Kleinhenz said.

Closer to home, the recent Ohio Department of Jobs and Family Services, in its “2024 Job Outlook,” is projecting that employment in the region will grow by 74,700 jobs to 1,475,300 by 2024. That’s a 5.3% increase over the 1,400,600 employed in the 2014 base year. The projected growth will come despite a loss of 7,200 manufacturing jobs.

The growth sectors include health care (27,400 jobs), food preparation and serving (7,100) and transportation and material handling (5,000). Many of the jobs that are expected to grow the fastest were in low-paying occupations such as home health aide and restaurant cooks. The report also projected significant demand for registered nurses and computer systems analysts.

Seasonally Adjusted Data

Month Non-Farm Small (1-49) Mid-Sized (50+) Goods-producing Service Producing
Dec 2016 Actual 1,169,560   476,230  693,330 210,690 958,870
Jan (est) 1,175,104   478,434  696,670 212,456 962,648
Feb (est) 1,177,120   479,248  697,872 212,924 964,196
March (est) 1,175,534   478,604  696,930 212,610 962,924
Apr (est) 1,176,482   479,069  697,413 211,641 964,841
May (est) 1,172,905   477,697  695,208 209,786 963,119
June (est) 1,167,386   475,617  691,770 206,406 960,980

July 21, 2017