The team at Benton Harbor-based Kinexus Group is renowned for keeping close tabs on critical economic data for our entire region, and over the past year as state unemployment data was released they frequently commented in their routine roundtable discussions that some of the numbers seemed somewhat out of whack with what they had expected. Now they know why.
In a media roundtable discussion this afternoon, Kinexus Group CEO Todd Gustafson, the group’s Chief Operating Officer Jake Gustafson, who is no relation to Todd, and Vice President of Public Relations and Government Affairs Al Pscholka reported that their fears were not unfounded.
Every February, the state rectifies mistaken data and resubmits corrections, and there were a couple of notable whoppers in our region on several sides of the equation.
First, and foremost, Pscholka says at a time when the state was reporting a local unemployment rate in Berrien, Cass and Van Buren Counties at around 4- or 5-percent, reality has proven that that number, as Kinexus folks had suspected on several occasions, was actually closer to 7-percent. In fact, the January rate for Berrien County has clocked in at 7.2-percent, which is 3-percent higher than the same time a year ago in January of 2020. For Cass County it sits at 6.1-percent, which is 1.8-percent higher than a year ago, and Van Buren County clocks in at 8-percent unemployment, also a 3-percent hike from a year earlier.
Pscholka says, also, “We’re finding that they particularly missed on the manufacturing sector, which was actually down by 8.5-percent at a time when we were being told it was either flat or slightly up in performance levels. That’s a big change.”
While reality shows that over the course of the year local manufacturers in Southwest Michigan lost about 1,100 jobs, there were still many local firms who had a solid year, while those impacted by the pandemic tended to be in the primary metals markets which were down by 24-percent locally, and machine-fabricated product sectors which saw a nearly 10-percent decline in jobs.
There is, however, also continued great news in the available jobs market with unique job postings “absolutely skyrocketing,” according to Jake Gustafson, which is a trend that began in December. In fact, there are currently 7,558 unique job postings in the past 90-days in the Tri-County region of Berrien, Cass and Van Buren Counties. Gustafson says, “That’s up by 3,202 postings from the pre-COVID baseline established in February of 2020. A whopping 77.6-percent increase!” It’s also an increase of 728 job postings from January of this year when there were 6,830 such postings.
All three of the Kinexus leaders maintain the mantra that there are lots of jobs available and caution those sitting on the sidelines for whatever reason, “The longer you wait to get back into the workforce, the harder it is going to be, and the fewer the opportunities for options you can choose from.” They note, “This is the right time. The job opportunities are there, the risks have been reduced significantly, and some businesses are even resorting to hiring bonus options to encourage people to step off of the sidelines and back into a job.”
Additionally, Jake notes, “We are finally seeing high-skill job postings return after months of lagging activity. Those postings now represent more than 34-percent of all postings with listed educational requirements of a bachelor’s degree or higher.” December proved to be the tipping point when high skill job postings rebounded in our region, which the team at Kinexus sees as “A positive sign for the region as high-skill labor is late to fire and late to hire during and following recessionary times.” Even more telling is the fact that the median wage among those postings has soared from $42,100 in September to $52,100 in February.
The local labor force was also among the incorrect data files during the pandemic. At a time when the labor force was routinely being fixed at around 132,000 on a historical trend, Kinexus had been told it dropped to 128,000 in December. The state’s rectified number was reset at 130,000 people but now that number has, in reality this time, dropped to 128,000 and that is one of the most concerning numbers that team Kinexus keeps tabs on at all times.
Also among the corrected numbers from the state was the status of the Leisure and Hospitality sector in the region which, as Jake Gustafson noted several times, “really took it on the chin throughout 2020,” due to state shutdowns, restricted capacities and more. While at its lowest point, that industry sector appeared to have lost fully a third of its jobs in our region, the corrected data from the state now suggests it was closer to a quarter of the jobs, but that’s still, as Jake noted, “Horrible for that sector.”
Kinexus says that the hospitality sector continues to be plagued by our proximity to the state line at a time when Indiana was fully open while Michigan restaurants and bars were either closed to indoor dining or restricted to just 25-percent capacity limits. Business owners have frequently had issues trying to field a workforce to handle customers because their talent has stepped over the state line to take jobs in Indiana rather than continue to face uncertain job opportunities at home. Gustafson notes, “These aren’t people who have packed up and moved from the region, they either got a job over the state line or continue to face reluctance over safety issues due to the pandemic.” He adds, “The faster we can increase capacity limits safely, and get the economy re-opened, the better it will be for the entire hospitality and leisure industry sector in our region.” It remains the most impacted sector locally as a result of COVID-19-induced job losses.
Also on a bright note, the Kinexus crew says that the agricultural sector in our region fared much better than had been feared, especially in successfully lining up migrant farm worker talent which had been forecast to be a serious crunch to that sector due to the pandemic. The sector saw a nearly 9-percent increase in employment year over year, as the impact diminished as compared to the feared outcome.
The Professional and Business Services Sector of the local economy has lost the third-most jobs in Berrien County following the revised numbers from the state with that sector down some 800 jobs year over year for a 13-percent decline, which Kinexus believes was potentially attributable to cutbacks at Benton Harbor-based Whirlpool Corporation.
In the Healthcare realm, data corrections revealed that the sector was less impacted locally than originally presumed, with year over year job losses in December some 38-percent lower than original estimates, and is actually down by only 3.1-percent locally as compared to a 7.5-percent loss statewide year over year.
Kinexus also reminds those on the sidelines, not working at this time, that they have lots of job-retraining opportunities and other potential solutions to help get them back on the payroll through their unit at Michigan Works.
