Wichita employment trends

While the unemployment rate in the Wichita metropolitan area has been declining, the numbers behind the decline are not encouraging.

The unemployment rate, a widely-cited measure of the health of an economy, is not an absolute measure. Instead, it is a ratio, specifically the ratio of the number of unemployed people to the number of people in the labor force. (The labor force, broadly, is the number of persons working plus those actively looking for work. 1)

It is entirely possible that the unemployment rate falls while the number of people employed also falls. This is the general trend in Wichita for the past seven years or so. Here are some figures from Bureau of Labor Statistics, part of the United States Department of Labor: 2

The May 2017 unemployment rate declined to just about half the January 2011 rate. The number of employed persons rose by 1.1 percent. The labor force fell by 3.7 percent.

If we consider only unemployment rate, it looks like the Wichita area is prospering. But the unemployment rate hides bad news: The number of jobs increased only slightly, and the labor force fell. While it’s good that there are more people working, the decline in the labor force is a problem.

In the nearby chart you can see these effects. The unemployment rate has been declining, although it has recently increased slightly. The labor force has been declining. The number of employed persons has increased, although it has recently declined.

To use an interactive visualization of employment data for Wichita, click here.

Example from the visualization. Click for larger.


Notes

  1. The labor force, specifically the civilian labor force, are those people working, plus those people actively searching for work, minus people under 16 years of age, minus people living in institutions (for example, correctional facilities, long-term care hospitals, and nursing homes), minus people on active duty in the Armed Forces.
    BLS defines unemployed people as: “Persons aged 16 years and older who had no employment during the reference week, were available for work, except for temporary illness, and had made specific efforts to find employment sometime during the 4-week period ending with the reference week. Persons who were waiting to be recalled to a job from which they had been laid off need not have been looking for work to be classified as unemployed.”
    The unemployment rate is “the number unemployed as a percent of the labor force.”
    Bureau of Labor Statistics. Glossary. Available at https://www.bls.gov/bls/glossary.htm.
  2. Bureau of Labor Statistics. Labor Force Statistics from the Current Population Survey. Available at https://www.bls.gov/cps/.

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