Labor force participation up, unemployment down in January

DES MOINES — The January labor numbers are in and they show unemployment dropped to three percent in the month compared to three-point-one percent for December.

Iowa Workforce Development spokesman Jesse Dougherty says there’s another number that’s more important. “Even more significant to us was that the state surpassed the 68 percent labor force participation rate,” he says. The labor force is the number of people working and those who are actively looking for work.

“That number, in particular, that participation rate number is one that the state has a really close eye on, you know, just as significant as the overall unemployment rate, because that’s actually telling us what that labor pool is looking like and where it’s moving,” Dougherty says.

The January numbers are just being released now because the Bureau of Labor Statistics first did its annual review of the previous year’s numbers. “From the previous year, we actually have around 17,000 more Iowans in the labor force than we were a year ago,” he says. Dougherty says the job picture continued to get better as the state recovered from the pandemic.

“We actually had around 38,000 — just over 38,000 jobs added within the last year. And that’s also significant because of the labor force participation rising at the same time, meaning that we’re also seeing more Iowans entering the pool,” he says. “That’s good news for employers too, because when they see that number climbing, it means that their talent pool is also getting bigger.”

Dougherty says the growth has been widespread. “And within the job numbers itself –the good news from that front was that there wasn’t one particular industry that was dominating that growth — we saw a lot of different growth within industries. Leisure and hospitality, which has continued to be a large sector has continued to grow,” Dougherty says, “But this past month, we also saw construction, we saw manufacturing, we even saw a couple of industries such as education and health services, that struggled during the pandemic that are starting to pick up more. So that’s also an encouraging sign.”

Dougherty says the labor force participation rate before the pandemic was in the 69 to 70 percent range — so to see it surpass 68 percent is significant.