Lance Lambert reports:
Local factories cut back on hiring in July, potentially slowing the pace of economic recovery in the region.
Manufacturing employment in Greater Cincinnati dropped slightly in the past 12 months, with the most recent monthly data showing a year-over-year decline in the total number of manufacturing jobs. The drop in employment comes after two years of robust manufacturing growth.
Local economists say the slowdown is problematic because one out of every nine workers is employed by manufacturers making everything from jet engine components to medical test kits.
“Cincinnati still has a significant manufacturing sector, and over the course of the past year the sector has grown slower than first thought,” said LaVaughn Henry, vice president of the Cincinnati branch of the Federal Reserve Bank of Cleveland.
June marked four years since the Great Recession officially ended, during which Greater Cincinnati made significant employment gains. But the local Purchasing Manager Index, a broad measure of business activity, shows the region’s overall economy has contracted in five of the past 12 months.
Economists blame the ripple effect on manufacturing, which helps stimulate employment in restaurants, service industries and banking.
“For every manufacturing job on the payroll, that should create two other jobs somewhere else in the economy,” said Janet Harrah, senior director of Northern Kentucky University’s Center for Economic Analysis and Development.
Henry said the manufacturing sector makes up a slightly higher percentage of Cincinnati’s employment compared to the nation’s, which is why even a small drop has a bigger effect here.
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