Kentucky lags more than 9 percentage points behind the nation in Labor Force Participation Rate

03/08/2016 01:28 PM

FRANKFORT – How to get up to 1.4 million more Kentuckians into the labor force was the center of a discussion between Senate lawmakers in committee Tuesday.

The Cabinet for Economic Development Acting Secretary Erik Dunnigan told members of the Senate Committee on Appropriations and Revenue, Kentucky is lagging far behind the nation in the area of Labor Force Participation Rate.

With a population of 4.4 million, Kentucky has 1.9 million people in the labor force in 2015 which equates to a Labor Force Participation Rate of 53.4 percent. That figure is far below the overall U.S. Labor Force Participation Rate of 62.6 percent.

Dunnigan said that increasing the number of employed Kentuckians is a priority for the cabinet and noted that while some areas of the state are struggling, many are above the national average Labor Force Participation Rate.

“When you look at Louisville, you look at Lexington, you look at northern Kentucky, we’re growing higher than the national rate, we’re growing higher than the state rate,”
Dunnigan said. “The real areas where we are struggling obviously is the mountain region of eastern Kentucky. We all know the impact the coal industry has had there.”

Sen. Dennis Parrett, D-Elizabethtown, noted that while workforce development is important to combat the problem, there are other factors contributing to unemployment in the commonwealth.

“When I talk to HR managers and plant managers, they tell me they have to interview ten to get one,” Parrett said. “When I ask them the reasons; it’s two things. They fail the competency test, but more importantly, they fail the drug test. Where do we go from here?”

Committee chair, Sen. Chris McDaniel owner of McD Concrete in Erlanger, reminded Dunnigan that cabinet’s role isn’t to necessarily to provide jobs but to create a business friendly environment which will allow Kentucky’s businesses to create the jobs which will, in turn, bring more revenue to the commonwealth.

“We need a good partner in government to be able to set the environment to create those jobs,” The Erlanger Republican said. “So, I would always encourage you to understand that it is a partnership between you and private industry to create the jobs that will be sustaining for the commonwealth.”

Dunnigan pointed out that there were some successes in the state in 2015.

New and expanding business investments hit a record $5.1 billion, the December 2015 unemployment rate was 5.3 percent and 2015 exports were $27.6 billion which represents 5 consecutive years of increases.


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