Tag Archives: economy

Labor Force Participation

 There are lies, damned lies and statistics. – Mark Twain

 America’s job picture appears to be seeing a huge improvement, with robust numbers that are giving investors’ confidence in the economy. The U.S. added 248,000 jobs in September, bringing the national unemployment rate below 6 percent.

 However, unemployment rates provide an incomplete measure of local labor market conditions. Unemployment does not include involuntary part-time workers; nor does it include discouraged workers who stop seeking work because they cannot find jobs. If we were to look at the labor force participation rate, which is essentially the percentage of persons 16 years of age and older that are classified as employed or unemployed (but looking for a job), we would see a different picture.

The labor force participation rate grew from about 60 percent nationally in 1970 to about 67 percent in 2000, with much of the increase resulting from increased participation by women. Unfortunately, the American labor force has been shrinking for more than a decade, and the September participation rate fell to 62.7%, marking the lowest level since 1978. The falling participation rate has been a hotly debated topic for some time, but the puzzle is even more confusing given the string of solid jobs gains and the continued drop in the unemployment rate.

A detailed new report from the White House Council of Economic Advisers estimates the majority of the decline has been driven by the retirement of the Baby Boom generation and that only one-sixth of the decline is clearly attributable to a weak economy. Other economists, however, believe that the decline in the labor force participation is a result of a historically weak economy and the unprecedented numbers of Americans who have lost their jobs and given up hunting for another one. Research from different arms of the Federal Reserve, such as this paper from a Boston Fed conference and this paper from the Philadelphia Fed, has reached contradicting conclusions.

So, how does our local labor force participation rate compare?

For selected areas, the U.S. Bureau of Labor Statistics Local Area Unemployment Statistics program produces current estimates of labor for participation rates. This includes all 50 states, the District of Columbia and a handful of large metropolitan area, excluding the Lexington-Fayette MSA. Thus, to estimate labor force participation locally, we used the U.S. Bureau of Labor Statistics Local Area Unemployment Statistics data to calculate the size of the labor force and Census Bureau population estimates to estimate the age-16-and-up population of Fayette County (per this ARC report, Local Area Unemployment Statistics data may validly be combined with Census population estimates to determine the labor force participation rate).

As the chart below indicates, the decline in national labor force participation is mirrored by both state and local data, although Fayette County appears to have experienced a much more dramatic drop in labor force participation, followed by a leveling off that, as of 2013, was comparable to the national rate.

Annual Average Labor Force Participation Rate


Lexington, KY Labor Force Participation Rate
Annual Labor Force Participation Rate


What about the big drops in participation locally?

While our diverse economy continues to reflect national trends, Lexington has experienced a fairly rapid growth in its working age population. The population age 16 years and over grew from 204,082 to 248,945 between 2005 and 2014, representing a 22% increase. Since the labor force is expanding at a slower rate than the population, the participation rate is going down. The large drops in labor force participation on the chart are reflective of significant jumps in the overall working age population, which were primarily due to an increase in college-aged residents. It could be that the younger populations that are largely responsible for the area’s population growth are enrolled in college, and thus, not part of the labor force. The good news for Lexington: rising education levels increase labor force participation rates in the long-term.

– CLX Economic Development Team

Commerce Lexington Update

  • Commerce Lexington is leading a group of Lexingtonians through Dubai this week. The itinerary includes time dedicated to exploring the connections between Central Kentucky and Dubai, including a meeting at the Dubai Chamber of Commerce, a look at the Dubai Thoroughbred racing tradition, and a visit with representatives of Dubai businesses with Kentucky connections.
  • The Kentucky Association of Manufacturers and the Kentucky Chamber of Commerce is hosting the first Kentucky Manufacturing Innovation Conference on October 24th at the Lexington Center. The one-day event is designed to bring the state’s manufacturers together to discuss, share and learn about cutting edge manufacturing innovations and technologies that can help increase productivity, improve quality and add to the bottom line. The conference is an initiative of BEAM, the Bluegrass Economic Advancement Movement, a partnership between the mayors of Lexington and Louisville and the Brookings Institution.


New Amazon Customer Service Center to Create More than 550 Jobs in Winchester, KY

[May 9, 2012] – The Winchester/Clark County Industrial Development Authority, Commerce Lexington Inc., the state’s Cabinet for Economic Development and the Bluegrass Alliance announced today that Amazon.com, Inc. (NASDQ: AMZN) plans to open a new 70,000-square-foot customer service facility in Winchester, Ky., investing more than $20.7 million and creating 550 full-time and hundreds of seasonal jobs in Central Kentucky by 2017.

“Amazon’s decision to grow its Kentucky footprint is fantastic news, especially when you consider the impact of more than 1,100 full- and part-time jobs it will bring to the central Kentucky region,” Gov. Beshear said. “Kentucky is proud to have Amazon choose Winchester for this growth opportunity and wish them continued success and prosperity.”

“We have thousands of employees working in Amazon’s fulfillment centers across Kentucky, and we’re proud to be expanding our presence in the state with the opening of a customer service center,” said Tom Weiland, vice-president, Amazon Customer Service. “We hope to have our team in Winchester up-and-running before the holiday season, and we’re looking for great people to join us in giving Amazon customers a first-class shopping experience.”

Amazon will host Information Sessions regarding employment opportunities for their new Customer Service facility on Wednesday, May 16th, and Thursday, May 17th, from 10:00 a.m. until 6:00 p.m. each day at the Clark County Extension Office located at 1400 Fortune Drive in Winchester. During these sessions, prospective employees will receive an overview of the company, customer service operation and information on how to apply for employment. For a full list of available opportunities visit www.amazon.com/csjobs.

“Our regional partnerships and our efforts to promote Central Kentucky have once again paid off with the announcement that Amazon will create of hundreds of jobs for Winchester/Clark County and our area,” said Todd Denham, Executive Director of the Winchester/Clark County Industrial Development Authority. “By working together with Commerce Lexington Inc., and our Bluegrass Alliance partners we have been able to bring home another world class operator in Amazon.”

The Bluegrass Alliance is a partnership of economic development professionals in Central Kentucky, working together to promote job creation and investment for the benefit of the region. The Alliance consists of: Fayette, Clark, Madison, Scott, Jessamine, Woodford, Bourbon and Franklin Counties. The Bluegrass Alliance team jointly markets the region and the great attributes of doing business in Central Kentucky.

“The partners of the Bluegrass Alliance have participated in many joint marketing trips to large cities to meet with key site selection consultants,” said Gina Greathouse, Senior Vice President, Economic Development at Commerce Lexington Inc. and Chair of Bluegrass Alliance. “The site selection firm that recommended our region to Amazon.com was Site Selection Group in Dallas. Our team, including Winchester and Lexington, has met with Site Selection Group many times in past during our marketing trips. This announcement is a great testament to the value of relationship building and working with economic development consultants, as well as building strong regional partnerships.”

“Being selected for a project of this magnitude will certainly impact our community, now and in the years to come,” said Winchester Mayor Ed Burtner. “The investment and careers that Amazon will create will ripple through our economy, putting people to work and generating income for our region. This is what economic development is all about.”

The new customer service center is expected to open in late summer and will be based at Winchester Plaza during construction of the permanent facility in the Winchester Industrial Park. The permanent facility is expected to open in 2013. The center will be operated by AMZN.wacs, Inc.

The Winchester facility will be Amazon’s first customer service center in Kentucky. The multi-million dollar investment in Winchester will allow Amazon to support customer calls and emails and provide technical support to various business lines.

New Ranking: 2010 Best-Performing Cities – 8th Biggest Gainer

The Milken Institute released their 2010 Best-Performing Cities last week and Lexington made a huge jump! Coming in at #100 overall, Lexington made the Biggest Gainers list by leapfrogging 61 spots from #161 last year.

The Milken Institute noted the following:

There are several commonalities among the biggest gainers on the 2010 Best-Performing Cities index. The most ignificant theme was a heavily service-based economy with little durable goods production. This is because the service sector tends to be less sensitive to business cycles. Conversely, metros with a heavier reliance on durable goods manufacturing, which took a dramatic hit during the recession, witnessed the largest declines in output and mployment. Among the biggest gainers, a majority also didn

New Location: United States Equestrian Federation (USEF)

The United States Equestrian Federation (USEF) officially announced on Friday that they are adding 12 new high-paying jobs in Lexington by locating their Equine Drug Testing and Research Lab in the heart of the Bluegrass. Joining USEF’s headquarters at the Kentucky Horse Park, the new lab will represent an additional $1.5 million investment into Lexington.

USEF Equine Lab Announcement

Full press release below:

Commonwealth of Kentucky
Office of the Governor

Kerri Richardson

Jill Midkiff

Elizabeth Roach

Mandy Lambert

First Lady Jane Beshear Announces Location of United States Equestrian Federation

New Ranking: Editors’ Location Pick

Lexington was recently voted as an Editors’ Location Pick by Business Facilities Magazine! Business Facilities is a trade magazine dedicated to economic development and Lexington was chosen from 250 metro areas in 2010 to be one of seven Editors’ Location Picks for the superb job Lexington has done in attracting new businesses and helping existing businesses to expand.

The editors note:

When we think of Lexington, KY, we usually conjure up fond memories of an idyllic location in the heart of the Bluegrass State. We picture majestic thoroughbreds serenely stepping their way through lush blue-green pastures, memories accompanied by a few sips of the world