Analysis: A generation of local unemployment

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Since May of 2008, month after month, Scott County has been in double-digit unemployment. And while that might sound like a long period of time, it has a long way to go before matching the 62-month stretch from June of 1980 through July 1985.

Last week’s story about Armstrong’s decision to layoff some 260 workers in April got us to thinking about the history of unemployment in Scott County through the years. We turned to the Tennessee Department of Labor and Workforce Development for answers.

On its website, the Department of Labor has facts and figures dating back to 1970 — and monthly unemployment data for all of the state’s 95 counties from 1973 forward.

We learned, for example, that Scott County has had its ups and downs over the past 40 years — from a high of 28.3% in July 1985, to a low of 3.9% in May of 2001. We’ve had long stretches of double-digit figures, and long stretches of single-digit figures, and over 40 years of tallying workforce statistics, it was revealed that Scott County has averaged 14.14% unemployment.

Some might say that’s Scott County’s chronic unemployment figure, even though there have been extremes, first one way then the other, time and again over those four decades.

For example, we had a stretch of eight months in 1983 (January through August) where the local jobless rate remained above 20%, peaking at 28.3% — the highest ever — with 2,280 out of work of a workforce estimated at 5,780.

Contrast those figures, if you will, with a 54-month stretch of single-digit unemployment figures from July 2003 through January 2008.

And while we may be living in one of the worst recessions of the modern era, you’d be surprised to learn that the decade just ended is the only one of the past four that we averaged single-digit unemployment. . . although just barely.

The average jobless rate for Scott County for the years from 2000 through 2009 was 9.9%.

Aside from the Great Depression in the 1930s, it appears that the worst decade for Scott County as far as unemployment is concerned, was the 1980s, when we averaged 15.4%. The 1970s saw the second highest jobless rate average of 11.5%, while the 1990s averaged 10.8% unemployment.

There are so many factors that go into computing and calculating the number in the workforce, as well as the total number of those employed and out of work, that many people are highly critical of the Department of Labor’s figures which are posted each month. Add to that the fact that the figures now include “seasonal” adjustments, whatever that means, which was not the case a few years earlier.

But right or wrong, those figures are all we have, and all are figured the same way from one county to the next across the state, month after month, which at least shows a trend.

Because the monthly unemployment rates are necessarily released a full month after the data is collected, it gets a bit confusing when a new plant opens, or another plant closes, and it doesn’t immediately show up in the jobless figures.

And mass layoffs at one plant are, historically, followed by similar announcements by other companies. That’s the nature of a recession. By the same token, however, the arrival of a new plant in a county often sparks the economy in ways unexpected, by creating other jobs in other sectors. Also, good news of that type often encourages company officials to make new hires that they have needed but were afraid to invest in because of a slow or stagnant local economy.

Rural counties such as Scott also tend to lag behind national trends — sometimes as long as a couple of years. In most cases, we won’t see an immediate turn-around in the jobless rate in Scott County when the national and state unemployment picture are showing improvement.

As stated earlier, the last time Scott County experienced single-digit unemployment was in May of 2008. We recorded a figure of 8.7% that month, based on a workforce of 8,510, with 7,760 gainfully employed and 740 out of work.

Since that time, the unemployment increased gradually, topping out at 19.5% in June and July of 2009, before falling to 17.7% in October and November, and ending the year at 18.8% in December.

The year 2009 wasn’t a good one. The average unemployment rate was 18.4% — well above 2008’s figure of 11.4% unemployed, and over four percentage points higher than the 40-year average.

From all indications, 2010 will be no better. In fact, current estimates show that Scott County’s unemployment could be in the mid-20% range by April, when Armstrong’s layoffs are recorded. Where we go from there is anybody’s guess, but if the trends studied over data collected over a 40-year period are any indication, high double-digit jobless figures may continue for several months.

The good news ­— if there is any — is that Scott County has an available workforce in a right-to-work state, with more than a couple of empty buildings just waiting to be occupied. We also have a local technical school and career center which are both gearing up for retraining displaced workers who are historically ready and willing to re-enter the workforce rather than consider moving somewhere else to start anew.