Kentucky’s unemployment rate dropped to its lowest rate in recorded history, according to new labor market data announced today.
In April 2022, unemployment in the Commonwealth was estimated at 3.9 percent. Kentucky has reached 4 percent unemployment at various points since the Bureau of Labor Statistics (BLS) began tracking state labor market data in 1976. This is the first time the state has crossed the 4 percent threshold. This new record reflects a historically tight labor market in which job availability and consumer demand are both strong while workers are harder to come by for employers looking to hire.
“Unemployment” is a technical term, referring to individuals who do not have jobs but are actively seeking employment. It is unrelated to unemployment benefits and does not include individuals who are unemployed and not looking for work. BLS gathers unemployment data through monthly surveys of households.
The U.S. unemployment rate in April 2022 was 3.6 percent.
Low unemployment is generally reflective of a strong economy. As Governor Andy Beshear noted in a press release this morning, “Kentucky’s economy is absolutely on fire, and today’s report shows that continued success is benefiting Kentuckians across the commonwealth.”
Unemployment in Kentucky reached an all-time high of 16.5 percent in April 2020. It has steadily declined since the summer of 2020.
With low unemployment also comes a limited supply of individuals looking for work and unfilled jobs. As of March 2022, Kentucky had an estimated 210,000 open jobs and a workforce participation rate of 58.1 percent. Workforce participation measures the percentage of adults in the state who are actively working or looking for work. Kentucky’s workforce participation rate is four points below the national average and ranks in the bottom 10 among the 50 states.
“Kentucky’s historically low unemployment rate is welcome news, and is another reminder that our economy has made a remarkable recovery from the pandemic,” said Kentucky Chamber Senior Policy Analyst Charles Aull. “With that being said, the number of open jobs and our low rate of workforce participation are major challenges that continue to hold our economy back and make it very difficult for businesses in Kentucky to meet consumer demands and grow. It is critical that we focus on bringing more Kentuckians into the labor market and removing barriers to work.”
In September 2021, the Kentucky Chamber Foundation released a major report highlighting long-term trends in Kentucky’s labor market and recommending policy proposals to encourage employment and workforce participation. During the 2022 legislative session, the General Assembly acted on several of these recommendations, including increased funding for child care and higher education, full-day Kindergarten, unemployment insurance reform, and criminal justice reforms. Building a healthier labor market and strengthening our workforce in Kentucky will continue to require bold action by policymakers.