The unemployment rate in the St. Louis area remained slightly below the national average in May, but a local economics professor says the story behind that number isn’t good news.
The Bureau of Labor Statistics released the non-adjusted data today. That means it does not take into account predictable seasonal changes.
The 7 percent unemployment rate for the St. Louis area is an improvement from May 2012, and far below the peak unemployment rate of 10.4 percent in 2009.
But the rate is dependent on how many people are looking for jobs. And Washington University economics professor Steven Fazzari says most of that improvement is because the labor market is shrinking.
"I think you can account for about 2 to 3 percent so-called improvement in the St. Louis County unemployment rate just by looking at people dropping out of the labor force," he said. "In the city, in some ways, it’s even worse."
The Bureau of Labor Statistics data show that area employers added 9,400 jobs between May 2012 and May 2013. Most of that growth came in the trade, transportation and utilities sector. But the number of people employed in manufacturing continued its decade-long slide.
Fazzari says the industry is producing more with fewer people, and that's bad news for St. Louis' more traditional economy.
"I’m skeptical that we can use manufacturing as a basis for at least massive improvement in the labor market," he said.
The regional jobless numbers come a day after the Brookings Institution ranked St. Louis 77th of the top 100 metropolitan areas in measures of growth like economic output and housing prices.
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