Economist: Retirements, Transfers Slow B-N Growth As COVID Restrictions Ease
Rivian, State Farm and other companies in Bloomington-Normal have been on hiring binges this year, and yet the Twin Cities is down 500 jobs over the last year, according to state employment data.
Illinois Wesleyan University economist Mike Seeborg said looking at job numbers month-to-month and even year-to-year can be tricky, especially in a pandemic year, but over the last decade the local workforce has been shrinking.
“Longer trend, we are seeing an employment decline and a labor force decline in our community,” Seeborg said. “That’s of some concern.”
Seeborg noted the financial sector took the biggest hit from August 2020 to last month, based on the data from the Illinois Department of Employment Security (IDES). Financial services cut 1,100 jobs over the last year. He said some workers may have been transferred, left the area to find work or decided the pandemic was a good time to retire.
“To the extent that retirements accelerated during the pandemic, people opt for early retirement, that too would contribute to what we are observing,” Seeborg said, adding the thousands of new jobs Rivian has brought to McLean County are helping to cushion the job losses employers have reported over the last year. “Rivian really is the big story right now and it’s a reason to be optimistic at least in the near term."
Seeborg said it's possible a chunk of the Rivian and State Farm jobs are going to people already working in the community. He said that can drive up wages. IDES data show there were about 87,000 people on the payroll in McLean County last month. That compares about 105,000 workers in 2011.
“The future of our labor market right now — at least the near and midterm future — looks pretty good, even though we have had some disappointing labor market data over the last decade that has shown a decline in our labor force and employment levels,” Seeborg said, adding that much of the job stagnation has can attributed to the pandemic, not only the recently expired expanded jobless benefits, but also concerns many have about working in an environment where COVID-19 is still a health concern for many.
“People are reluctant to come back to jobs, particularly jobs where a lot of personal contact exists,” he said, adding that will limit the impact of those expanded benefits expiring. “I’m not sure the effects are going to be large."
IDES data show leisure and hospitality and construction have been the leading job gainers over the last year as COVID restrictions have eased.
Bloomington-Normal's unemployment rate is still second lowest in the state at just over 5%.