ACE Report: Northeast Ohio posts small employment gain in November

Northeast Ohio eked out a small employment gain in November, according to the latest Ahola Crain’s Employment (ACE) Report.

Seasonally adjusted employment in November for the seven-county area of Cleveland and Akron measured by the report was 1,172,672, a gain of just 286 jobs from 1,172,386 in October.

The change is small, but Jack Kleinhenz, the Cleveland Heights economist who created the ACE Report model noted it was unusual in this respect: The region lost 152 service jobs from October to November, but it added 438 jobs in goods-producing fields.

“The offset is a turnaround from recent trends where the growth in service jobs offset losses in manufacturing,” Kleinhenz wrote in an analysis of the November ACE Report data.

The region remains in positive jobs territory from a year ago. Kleinhenz said November employment in Northeast Ohio was up by 4,570 jobs from the like month of 2015.

November’s jobs figure also is above the ACE Report’s seasonally adjusted three- and six-month averages, which “suggests economic activity and job growth has picked up some momentum from the slower pace of job growth the region experienced in the second quarter,” according to Kleinhenz.

Underlying November’s ACE Report  figures are some positive regional and national trends.

For instance, Kleinhenz wrote in his analysis that  unemployment claims for the region “decreased by 22% over the same month a year ago. Coincidental measures for Ohio are up 2.2%, and  construction put in place and retail sales show gains in the last three months.”

National indicators show an economy that is picking up the pace.

U.S. Gross Domestic Product was revised higher to 3.2% for the third quarter, which Kleinhenz wrote is a “significant number relative to the average 2.2% growth we have seen  in this expansion.”

The Institute for Supply Management’s manufacturing index in November posted a reading of 53.2, which ties the fastest pace of this  manufacturing sector indicator over the past 18 months, according to Kleinhenz. (A reading above 50 indicates the sector is expanding.)

He also noted that the Federal Reserve’s Labor Market Conditions Index, a broader measure of the health of the labor market than provided by any single report, “indicates that the labor market is continuing its path of improvement.”

The Fed’s labor index increased by 1.5 points in November, about the same level of improvement as in October.

“All in all, these national trends should be a good indicator of what to expect at the state and regional levels,” Kleinhenz concluded.

Seaonally adjusted data

Month Non-Farm  Small (1-49)  Mid-Sized (50+) Goods-producing Service Producing
June 2016 (act) 1,167,272   475,237   692,035 211,159 956,113
July (est) 1,175,087   478,079   697,008 217,449 957,638
Aug (est) 1,171,162   476,645   694,518 214,389 956,773
Sept (est) 1,169,567   476,086   693,480 212,792 956,775
Oct (est) 1,172,386   477,203   695,183 213,748 958,638
Nov (est) 1,172,672   477,293   695,380 214,186 958,486
Recent Month’s Estimated Change
Oct ’16 to Nov ’16 286   89.50   197 438 (152)
Diff from Nov 2015 4,570   2,016   2,554 (1,403) 5,973
Trend
3-month 1,171,542   476,861   694,681 213,575 957,966
6-month 1,171,358   476,757   694,601 213,954 957,404

ACE Report: Despite job losses, other signs suggest economic growth

A projected decline of 2,343 jobs in June ended a five-month string of Northeast Ohio job gains, though the loss may only reflect a summertime blip since other indicators suggest job and economic growth, according to data in the latest Ahola Crain’sEmployment (ACE) Report.

Also, the month-to-month, 0.02%, drop in seasonally adjusted employment for the seven-county Akron-Cleveland region, is balanced against a year-over-year gain of 6,249 jobs, a 0.54% increase from June 2015 to June 2016.

“It’s hard to gauge whether or not the expected pullback in payrolls point to a sea change in regional economic activity,” said Jack Kleinhenz, the Cleveland Heights economist who created the ACE model. “Payroll growth has been choppy.  A similar pattern was evident in 2015 as payrolls fell off in the summer but then rebounded in the fall.”

Private-sector employment in the metro area dropped 0.22%, or 2,589 jobs, between June 2015 and July 2015, according to the ACE model, before recovering.

The report projects that service producing firms account for about 2,279 lost jobs, while the goods producing sector shows only a loss of about 64 jobs.

Kleinhenz noted that the stronger dollar “has shown to be a significant speed bump for regional, state and U.S. manufacturing exporters and has created a drag on domestic employment, income and spending.”

He said the research office of the Ohio Development Services Agency estimates that Ohio merchandise exports declined 3%, or $50.7 billion, between 2014 and 2015. But, Kleinhenz reported, other indicators of the economy do point in a positive direction.

“Both the Institute of Supply Management’s manufacturing and non-manufacturing indexes showed a pickup in the pace of growth in June and registered expansionary readings for survey’s employment component,” he said. “This bodes well for area income and spending.”

The U.S. manufacturing sector showed strong growth in June according to the latest monthly survey conducted by the Institute for Supply Management. Manufacturing supply executives indicated a Purchasing Managers’ Index increase of 1.9%

Of the 18 manufacturing sectors tracked by ISM, 13 reported growth in June led by printing, textiles, petroleum and coal products and food, beverage and tobacco products. The three industries reporting contractions are electrical equipment, appliances and components; transportation equipment; and rubber and plastic products.

Month Non-Farm Small (1-49) Mid-Sized (50+) Goods-producing Service Producing
Dec (actual) 1,169,198    475,677   693,522 216,446 952,753
Jan (est.) 1,165,378    474,177   691,201 214,962 950,416
Feb (est.) 1,167,066    474,922   692,143 214,430 952,635
Mar (est.) 1,167,163    474,950   692,213 214,622 952,541
Apr (est.) 1,169,020    475,698   693,323 215,075 953,945
May (est.) 1,173,765    477,613   696,152 216,172 957,593
June (est) 1,171,422    476,634   694,788 216,108 955,313

 

By

July 29, 2016

ACE Report: Regional Job Market Closes 2015 on a High Note

The job market in the seven-county Cleveland-Akron metropolitan area closed 2015 with a relatively strong performance, adding 2,350 jobs from November on a seasonally adjusted basis.

The latest Ahola Crain’s Employment (ACE) Report projects that the region’s private sector grew to 1,162,540 jobs in December from 1,160,190 in November, an increase of 0.2%. Compared with December 2014, the Northeast Ohio workforce also is in positive territory, as it has posted a modest gain of 2,438 jobs since then.

Local economist Jack Kleinhenz, who compiles the ACE Report data, wrote in an analysis accompanying the December report that the month’s non-seasonally adjusted estimate of 1,171,636 jobs “is ahead of the 3-month and 6-month averages, which indicates further economic activity and job growth.”

But Kleinhenz offered a caveat, noting, “In looking forward, however, it is typical for the trajectory of monthly employment in the region in the early months of the year to be pared significantly back. Seasonal adjustment of this series masks that fact. …

“We expect a similar pattern to take place and recognize that some dampening of the pace of employment gains is projected,” he wrote. “This near-term development is not surprising in that the manufacturing sector has been battered and bruised.”

The not-bad, not-great nature of the December ACE Report is consistent with the state of Ohio’s jobs report for the month, which found unemployment rose to 4.7% from 4.5% in November.

Nonagricultural wage and salary employment increased 15,200 over the month, to 5,451,500 in December from a revised 5,436,300 in November, according to data from the Ohio Department of Job and Family Services.

However, the number of workers unemployed in Ohio in December was 269,000, up from 255,000 in November.

On balance, through, the state is better off than it was a year ago, as the number of unemployed has decreased by 23,000 in the past 12 months from 292,000. In December 2014, Ohio’s unemployment rate was 5.1%

Crain’s partners with The Ahola Corp., a payroll and human resources services company in Brecksville, and Kleinhenz for the ACE Report to provide monthly data about the size of Northeast Ohio’s workforce.

Seasonally Adjusted Data

Month Non-Farm Small (1-49) Mid-Sized (50+) Goods-producing Service Producing
June(Actual) 1,163,941   473,458   690,483   216,623   947,318
July(est.) 1,157,178   470,669   686,508   215,899   941,279
Aug(est.) 1,157,981   471,009   686,973   215,870   942,111
Sept(est.) 1,158,628   471,285   687,343   215,797   942,831
Oct(est) 1,161,187   472,346   688,841   215,991   945,195
Nov(est.) 1,160,190   472,052   688,138   214,203   945,987
Dec(est.) 1,162,540   473,031   689,509   214,310   948,229
Recent Month’s Estimated Change
Nov ’15 to Dec ’15 2,350   978.92   1,371   107   2,243
Diff from Dec 2014 2,438   1,221   1,217   (2,831)   5,269
Trend
3-month 1,161,305   472,476   688,829   214,835   946,470
6-month 944,272   944,272   944,272   944,272   944,272

By Scott Suttell

January 29, 2016

ACE Report: Northeast Ohio Has First Job Drop Since July

Employment in the seven-county Cleveland-Akron metropolitan area is being projected to dip ever-so-slightly in November. The estimated decline — 1,400 jobs or 0.1% of the employment in an economy of nearly 1.2 million jobs — reflects an annual slowdown in the manufacturing, or goods-producing, sector, according to the latest Ahola Crain’s Employment (ACE) Report.

The decline is the first drop since July and reflects an estimated increase of 834 jobs in service employment that is offset by a loss of 2,233 jobs in goods-related businesses.

Year-over-year, though, employment is up, according to the ACE numbers, with a modest gain of 5,427 since November 2014, a 0.58% seasonally adjusted increase.

“The region in recent history registers softer employment gains for the goods-related sector, typically in the later months of the year, and we are not overly concerned about the contractionary reading (for November) as the region remains in expansion territory,” said economist Jack Kleinhenz, who compiles the ACE data.

“The recent trend of performance is indicating further economic activity and job growth, but perhaps at a slower pace,” Kleinhenz said.

The regional economy continues to lag the national economy. Private employment nationally rose by 2.1% over the last 12 months, according to current employment data compiled by the federal Bureau of Labor Statistics.

The two sub-metro areas in the region are performing similarly, though Cleveland is doing narrowly better than the Akron metropolitan area.

Estimates by the Ohio Department of Jobs and Family Services (ODJFS), which analyzes the BLS data, found that the number of people employed grew by 0.018% over the last year in its Akron metro area, which includes Portage and Summit counties. Employment in the five-county Cleveland metro grew 0.019% from November 2014 to November 2015. The ACE estimates cover only private sector employment; the BLS data include all non-farm employment, including the government workforce.

Similarly, unemployment for the Cleveland metro was 3.7%, according to ODJFS, down from 5% in November 2104, while the two-county Akron metro had an unemployment rate of 4.6%, down from 5.3% a year ago.

Regional employment is expected to continue to grow, though slowly. Economists at PNC Financial Services Group, parent of PNC Bank, found optimism in October when the company surveyed small and middle market business owners in Ohio.

Because of optimism about the outlook for their own businesses and for the local economy, 19% of business owners surveyed said they planned to hire in the months ahead, compared with only 10% who had plans to hire six months earlier.

In addition, 36% of those employers — PNC did not disclose the size of its sample — said they expected to increase employees’ pay, up from 26% who were planning pay raises in the spring. Of those planning raises, 59% said they planned to give raises of 3% or more during the next six months.

Seasonally Adjusted Data

Month Non-Farm Small (1-49) Mid-Sized (50+) Goods-producing Service Producing
June (actual) 1,161,467 472,360 689,108 217,477 943,991
July (est.) 1,159,789 471,691 688,097 216,957 942,831
Aug (est.) 1,161,200 472,304 688,896 216,667 944,533
Sept (est.) 1,162,105 472,702 689,403 216,408 945,697
Oct (est) 1,164,808 473,822 690,986 216,617 948,190
Nov (est) 1,163,408 473,390 690,018 214,384 949,024
Recent Month’s Estimated Change
Oct ’15 to Nov ’15 (1,400) (431.7) (968) (2,233) 834
Diff from Nov 2014 5,427 2,430 2,997 (2,174) 7,601
Trend
3-Month 1,163,440 473,305 690,136 215,803 947,637
6-Month 1,162,129 472,712 689,418 216,418 945,711

Crain’s Cleveland Business