Illinois’ low unemployment rate stems from record labor drop-off

January 26, 2018

Growing divide between the employment picture in the Chicago area and the rest of the state

CHICAGO (Jan. 26, 2018) — Most Illinois cites are experiencing decreases in labor force participation, according to new metro jobs data from December 2016 to December 2017 published by the Illinois Department of Employment Security. This workforce shrinkage problem occurred despite year-over-year employment gains in many metropolitan areas and declining unemployment rates across the state.

Data highlights:

  • Decreases in the number of job seekers – not increased employment – accounted for the declining unemployment rates in nearly every metro area and 102 counties.
  • Only Chicago-Naperville-Arlington Heights, Kankakee and Lake-Kenosha (which includes Wisconsin’s Kenosha County) saw a drop in the unemployment rate primarily due to job-seekers finding work.
  • The biggest losses in labor force participation were Danville (3.4 percent loss), Decatur (2.4 percent loss) and Springfield (1.6 percent loss).
  • Chicago-area jobs gains accounted for 28,700 of the state’s 37,900 net new jobs.
  • Without Chicago-area gains, the state would have only gained 9,200 jobs.
  • Three metro areas lost jobs: Danville (down 2.1 percent), Decatur (down 1.4 percent) and Springfield (0.7 percent).

Quote from Orphe Divounguy, chief economist at the Illinois Policy Institute: 

“Illinois’ record-low unemployment rates are troubling because they are, unfortunately, not due to more Illinoisans finding a job. Illinois needs decreasing unemployment rates that stem from more residents being able to find a job, not because they are so fed up with not being able to find work that they stop looking.

“Lawmakers should adopt policies that foster a healthy, fair business climate across industries and across the state. Until the state can adopt policies that will reduce the cost of doing business, Illinois’ jobs growth and labor force participation will remain lackluster.”

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