Mitchell's unemployment rate drops to lowest level since December

Good news about the local economy emerged Wednesday, just ahead of the biggest shopping day of the year.

According to new data from the state Department of Labor, Mitchell’s unemployment rate dropped to 4.2 percent in October. That’s the city’s lowest rate since December.

More important, said Bryan Hisel, executive director of the Mitchell Area Chamber of Commerce and Mitchell Area Development Corporation, the city’s total labor force in October was up by 85 people over the same month of 2008.

“It’s generally good news all the way around,” Hisel said. “We’re retaining our labor force, and a few more folks are working.”

The impact of the national economic recession first showed up in Mitchell’s jobs data in December, when unemployment jumped a full percentage point to 3.9 percent. The rate has been above 4 percent every month since, including a peak of 6.7 percent in March. Most recently, the rate had been at 4.8 percent for three consecutive months.

City unemployment rates are not seasonally adjusted, meaning that temporary impacts from seasonal industries like tourism and construction are not excluded. Mitchell’s non-seasonally adjusted rate of 4.2 percent in October was lower than the statewide rate of 4.5 percent, and far lower than the national rate of 9.5 percent. Among South Dakota’s largest cities, Mitchell’s October unemployment rate was the fifth-highest.

Despite the positive unemployment trend, Jean Anderson, manager of state government’s South Dakota Career Center in Mitchell, said job openings are few. The center currently has 286 job listings, compared to 516 at this time last year.

“It’s a tough market out there right now,” Anderson said. “Employers, if they are hiring, are hiring cautiously. And some are in a hold mode yet, as far as we can tell. There are less jobs and a lot of competition for those jobs.”

Many of the city’s unemployed workers were laid off from manufacturing firms such as Trail King, which has acknowledged about 150 layoffs from its local trailer-manufacturing plant since the recession began. Hisel said the impact of layoffs in the city has been mitigated somewhat by three factors: new job development, including the expansion of local manufacturer Enertech and the opening of a Mitchell location by the medical back-office firm EthosPartners; the continued strength and growth of local telecommunications firms Martin Group, Innovative Systems and Vantage Point Solutions; and the excellent crop-growing conditions enjoyed this year by the agricultural industry.

“Those three parts of the economy have kind of held us up,” Hisel said.

The city’s tourism industry also performed well during the summer, led by a 13 percent increase in visitors to the Corn Palace.

The pheasant-hunting industry may be experiencing a slight decrease in business due to a decline in corporatesponsored hunts, said Hisel, whose observation is supported by data from the local airport.

During the Thursday and Friday prior to the opening weekend of the pheasanthunting season last month, 63 planes arrived at the airport. Last year, that number was 66.

In the months ahead, one of the most important economic indicators will be the results of the holiday shopping season. The start of that season is traditionally identified as today, the day after Thanksgiving.

Eighty-four percent of businesses surveyed recently by the South Dakota Retailers Association said they anticipate good-to-excellent or fair sales during the final three months of the year. Hisel offered a similar prediction.

“My sense is it’s too early to tell, but I am optimistic that we’re going to have a good holiday season with stable-toslight growth.”

It’s also too early to tell, Hisel said, if the recent drop in local unemployment rates is a sign of long-term economic recovery. He said uncontrollable factors such as petroleum and gasoline prices could “send us back into a tailspin again.”

“I’m taking cues from what the economists have been talking about,” Hisel said, “and they’re saying we’re going to have a rather slow and sluggish recovery over time.”

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