Uric Dufrene-1

Uric Dufrene, Sanders Chair of Business at IUS

SOUTHERN INDIANA — The latest employment report continues to show issues with the availability of workers, as Kentucky and Indiana’s labor forces were essentially flat from June to July.

A U.S. Bureau of Labor Statistics report issued Friday recorded Indiana’s jobless rate at 4.1% for July. It was 4.4% in Kentucky, as both states saw little change in unemployment.

But in terms of labor force, Indiana only incurred about a 1.2% increase from July 2020, with the addition of 42,000 workers. Kentucky only saw an increase of 12,000 workers since July 2020.

“Labor force challenges are significantly higher now than prior to the pandemic,” said Uric Dufrene, Sanders Chair in Business at Indiana University Southeast. “Both states were facing workforce challenges prior to the pandemic, and these have only intensified with the pandemic.”

But an establishment survey offered some positive news, as it showed Indiana gained 10,600 payrolls from June to July. The manufacturing sector added almost 5,000 jobs.

Manufacturing is experiencing low levels of inventory, which is good, Dufrene said.

“Low inventory levels will bring strong production for the rest of the year, and we will continue to see some growth in manufacturing payrolls,” Dufrene said.

But again, the biggest threat to payroll growth, Dufrene continued, is the lack of enough workers to meet demand. The result will likely be the continued trend of automation, with companies substituting machines for employees.

“Manufacturers, through investment in machinery, automation, or just plain creativity and ingenuity, will help manufacturers meet demand, in the face of labor scarcity,” Dufrene said.

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