Why is Chicago's Unemployment Rate Performing Poorly? (Detroit: sales, 2014)

[Flamedown]

Just curious to see why people think Chicago's metro unemployment rate(UE) is not doing so good compared to most other large metros in the US? The BLS just released its June metro UE update and Chicago's was noticeably poor. Its UE is now 10.1% which is tied for third worst with Las Vegas, and it is only behind Detroit and the Inland Empire metro area in California. Even worse, for its year over year change, Chicago's UE has increased by 0.7% from June 2012 which is the worst increase for any large metro area in the US. Most of the large metros UE have decreased from last June, and for metro's with UE's over 9%, only Chicago's and Memphis's have increased from last year.

Keep in mind I made this thread to explore why this is happening, and not to start a flame war. I am actually considering moving to Chicago next year, but this makes me highly hesitant. It is concerning to see how most major metro's UE are improving, but Chicago's is at least stuck in neutral if not getting worse.

Unemployment:
Unemployment Rates for Large Metropolitan Areas

Year over year:
Over-the-Year Change in Unemployment Rates for Large Metropolitan Areas

[marothisu]

There is a large amount of semi unskilled labourers and also lazy people in the area IMO. Something needs to be done to narrow the skills gap. Many companies are hiring again, but many are jobs where you need a college degree, if you get what I mean there. Pretend you are a software developer - you shouldn't really have a problem finding a job. Even during the height of the recession people in a field like this could find jobs. My area layed off maybe 4 people during the height of that, and I know for a fact that all of them found new jobs in the area within 2 weeks of getting word of their lay off.

[Vlajos]

It's a very good question. I don't really have a good answer. According to the BLS, non farm payrolls are up over 60K year over year in the metro area for 6/13 yet the UE rate has increased? There is a big disconnect somewhat due to how the government gets the UE rate vs. the payroll numbers.

Even stranger, according to BLS the number of Employed at 6/13 is 3,774,492 but there are 3,803,700 non farm payroll jobs in the metro. I have seen these things before and BLS revises the numbers at the end of the year. My guess is the revised EU numbers done in January 2014 for 2013 will reflect a reduced UE rate.

[Maintainschaos]

But the total number of jobs in the area was still increasing, right? Maybe as people who originally dropped out of the labor pool see that jobs are increasing, they are reentering the job market in search of employment?

[marothisu]

There are also people who have jobs and claim unemployment. I have two friends who were getting paid mainly cash for their work (and both are fairly high paying) and were still able to claim unemployment. Though one of them put an end to that a year ago.

[Chicago60614]

Jobs increasing, but number of people who are coming back and looking for a job increasing more.

Tons of social support and disability going around in Chicago from what I've seen - so people have a way to support themselves and are more lazy about getting on the actual unemployment list/actively working. Also the working who are still collecting benefits since Illinois dishes them out so actively. That and the large lower class towards the south/west that doesn't have the skills to get a job.

If you're at least midly educated and actually want and job and are willing to work towards that I honestly don't think you'll have a problem. I've known of many many people who moved to Chicago over the past few years and none of them are having any issues.

I'm in finance and get bothered by recruiters all the time with job openings. It's very skewed as far as a blanket "unemployment rate".

[chet everett]

There are those who only want to see the up beat news and those who see things more realistically. I know many people with very good skills who have seen their employment prospects dry up largely becuase of the terrible economic conditions in many sectors of the economy. Once upon a time Chicago was a powerhouse in the broad category of journalism / specialty communications. Firms that used to employ thousands of people in everything from writing the editorial content, to advertising sales / subscriber retention, to production have seen massive reversals in employment. Similar cutbacks have hit myriad firms in the speciality financial services sectors -- fewer and fewer people are needed by the smaller number of traditonal pension advisory firms, business-to-business credit organizations, specialty reporting firms and even the publishing companies that once served these businesses. Consolidation in all kinds of sectors from insurance to construction/ engineering have decimated the once richly diversified employment of the Loop.

What firms are doing well? The me-to firms focused on capturing some niche of online advertising. While I have no doubt that some of these firms do staff up with skilled workers I suspect that a whole lot of the younger people that do land jobs that are are essentialy focused on outside sales or commodity level computer skills will not have sustainable careers.
Even more troubling the hordes of folks that received deficient education in CPS and other dysfunctional districts will never even have a shot at any good job. They are doomed to the lowest paying least skilled employment. With the collapse of labor intensive industrial work that at least churned out costly capital intensive goods the future of the unskilled to limp from one minimum wage job to another is something that will have troubling consequences for the region.

[marothisu]

Originally Posted by Chicago60614

If you're at least midly educated and actually want and job and are willing to work towards that I honestly don't think you'll have a problem. I've known of many many people who moved to Chicago over the past few years and none of them are having any issues.

I'm in finance and get bothered by recruiters all the time with job openings. It's very skewed as far as a blanket "unemployment rate".

This has been my experience as well. I have met many people who moved here within the last few years from out of state with jobs, no problem, and a handful of my own friends as well. I also get contacted a few times every week for the last few years about stealing me away from my current job.

[marothisu]

It should also be mentioned that just having a skill will not necessarily get you a job at a company of your choice. When we hire, for example, we look at your passion as well. If you give me 5 candidates, and only 1 of them does stuff outside of work dealing with the line of work (maybe they made a few of their own mobile apps on their own time for fun and did a great job on it), then give me that candidate over the other 4 any second of the year.

But really, I have only one friend who hasn't been able to get a job since being laid off (he's not in IT) a few months ago, but he's had at least 6 interviews and gotten to the final stages in nearly all of them. Most of these companies he's been interviewing with as well have been in the suburbs minus 1 which was in the city.

[Flamedown]

Originally Posted by Maintainschaos

But the total number of jobs in the area was still increasing, right? Maybe as people who originally dropped out of the labor pool see that jobs are increasing, they are reentering the job market in search of employment?

Well some of the increase is due to all the graduations in June, for nearly all US metro's UE's increased from May to June. The BLS does not seasonally adjust the data though, so the year to year data is where you find the trends.

Like you said, it is probably people reentering the job market in search of employment. Problem is that is happening nationwide, yet most other metro's year to year UE are decreasing.

@Vlajos: Well even if there is a 60k increase in jobs, the UE can still rise if more people start looking for jobs than there is jobs being created. Perhaps there is a disconnect in the numbers, but is the same happening for the other metro's unemployment reporting?

@Chicago60614: From what I have seen from the Chicago job market listings, if you fit a specific professional role, software developer, advertising, etc... it does not look like the job market is too bad, but if you have a more generalist, humanities/social sciences educational background there are still few jobs. Thus my concentration on the more general blanket UE as I think that is more reflective of the job market for people who do not fit professional niches.