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Lincoln unemployment rate drops below 2%
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Lincoln unemployment rate drops below 2%

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US Weekly Jobless Claims Hit , New Pandemic-Era Low. The Labor Department reported a total of 348,000 jobless claims for the week that ended on Aug. 14. The number is down 29,000 from the previous week and less than the Dow Jones estimate of 365,000. Ongoing claims fell to 2.82 million, which is also a new pandemic-era low. First-time filings for unemployment insurance hit a new low, despite worries over the delta variant. The last time claims were this low was Mar. 14, 2020, just as the COVID-19 pandemic declaration was announced. Despite the new low, the jobs gap remains large, with six million fewer Americans being considered employed now than prior to the pandemic. Economists suspect a number of reasons for this, including many workers pushing for extra protections as a result of the ongoing pandemic. As a result, wages have been increasing with average hourly wages up 4% year over year in July

Lincoln's July unemployment rate dropped below 2% for the first time since at least 1990, while the state's rate hit its lowest level in more than 20 years.

The 1.9% unemployment rate in the Lincoln Metropolitan Statistical Area last month is the lowest recorded in data going back to 1990. The rate hit 2% several months in 1997 and 1998 but never dropped below that level.

The last time the state's unemployment rate was as low as the 2.3% recorded last month was in November 1998. The last time it was lower was April of that same year. Nebraska continued to have the lowest rate in the country in July.

"Nebraskans are tough, hard-working people, and they are powering Nebraska’s current economic boom," Gov. Pete Ricketts said in a news release.

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Low unemployment typically is a good thing for the local and state economy. But employers are having trouble filling jobs, and some businesses, particularly restaurants, are cutting back on hours and days of operation because of a lack of staff.

"While the unemployment rate has reached a historical low and the number of filled jobs is up significantly over July of 2020, many employers continue to seek qualified talent,” Commissioner of Labor John H. Albin said in the release.

Lincoln's data, which is not seasonally adjusted, shows the workforce was actually bigger in July than it was a year ago by about 700 people. There were 6,275 more people employed than in July 2020 and 5,572 fewer unemployed. The number of jobs grew by 8,251. However, the July labor force was still smaller than it was in July 2019.

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Statewide, the labor force continues to be smaller than it was a year ago, which is likely a function of people who dropped out during the pandemic and have not yet come back. The state as a whole had nearly 7,500 fewer workers than a year ago, with 13,605 more employed and 21,062 fewer people unemployed. The number of jobs in the state grew by 35,918.

Eric Thompson, director of the Bureau of Business Research at the University of Nebraska-Lincoln, said that while the low unemployment rates are good news for workers, they "reinforce that this is a challenging time for state and local businesses seeking to expand their workforce."

"Businesses are especially challenged because labor force participation has not yet recovered to pre-pandemic levels in Nebraska," he said. "Growing the workforce is a key challenge for the Nebraska economy going forward."

Politicians, business owners and others have cited ongoing federal stimulus as the reason behind the labor shortage, but Creighton University economist Ernie Goss said it's only one of several factors.

"Federal stimulus payments, which incentivize not working, account for a portion of the shortage," Goss said. "Other factors include the lack of child care and fear of the coronavirus in the workplace."

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Reach the writer at 402-473-2647 or molberding@journalstar.com.

On Twitter @LincolnBizBuzz.

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Business reporter

Matt Olberding is a Lincoln native and University of Nebraska-Lincoln graduate who has been covering business for the Journal Star since 2005.

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