By Jay Miller
Continuing its roller-coaster ride, Northeast Ohio lost 375 jobs in March, according to the latest Ahola Crain’s Employment (ACE) Report. The March loss was preceded by a February increase, which was preceded by a January loss and a December increase.
The longer, year-over-year gain, however, is positive, with Northeast Ohio employment up 3,316 jobs, a gain of 0.29%.
“The regional economy is expanding and is in better shape than many expected (given the) uncertainty caused by the volatile financial markets that disrupted economic activity earlier this year,” said economist Jack Kleinhenz, who compiles the ACE data, referring to stock market ups and downs that followed the price of oil.
Employment growth came entirely from the service sector, with employment in that sector growing by 6,397 jobs, a 0.7% increase. That was offset by a loss of 3,081, or 1.5%, in the smaller industrial sector.
Loretta Mester, president of the Federal Reserve Bank of Cleveland, explained the weakness in industrial sector employment in an April 1 speech to the New York Association for Business Economics after noting that the slowdown in the energy sector was affecting employment in northern Ohio and western Pennsylvania.
“Regional firms with international exposure, such as steel producers, also continue to struggle in the wake of dollar appreciation and lower commodity prices that reflect weak global demand,” she said.
“While manufacturers with ties to energy and steel production have faced challenges, the weakness in that segment has been offset by production increases at manufacturers supplying the construction industry and by the auto industry.”
The ACE Report surveys only Cuyahoga County and the six counties that surround it, while the Fed’s Cleveland-based Fourth District comprises Ohio, western Pennsylvania, eastern Kentucky and the northern panhandle of West Virginia.
Michael Teshome, an economist who covers the Midwest for PNC Financial Services Group, agrees with Mester but also sees a future of employment growth in other sectors.
“Layoffs in the steel industry will restrain employment growth in manufacturing,” he wrote. “Health care, finance and professional services will add to the area’s economic growth.”
PNC forecasts employment growth in Northeast Ohio at 1% for 2016 and 1.1% for 2017. Longer term, PNC’s economist sees opportunity for greater growth.
“Though still only in their early development stages, manufacturing hubs for the machinery of new energy technologies and transportation equipment hold great promise for those regions that can attract and cultivate them,” Teshome wrote.
“The (Northeast Ohio) region’s lower costs and availability of underutilized assets will be an important tool in attracting new industries and opportunities into the region in the years ahead.”
|Month||Non-Farm||Small (1-49)||Mid-Sized (50+)||Goods-producing||Service Producing|
|Recent Month’s Estimated Change|
|Feb ’16 to Mar ’16||(375)||(154.98)||(220)||(34)||(341)|
|Diff from Mar 2015||3,316||1,607||1,709||(3,082)||6,397|