FRANKFORT, Ky. (March 4, 2024) — Kentucky’s annual unemployment rate for 2023 was 4.2% according to the Kentucky Center for Statistics (KYSTATS), an agency of the Kentucky Education and Labor Cabinet. This is an increase from 4% in 2022.

The U.S. annual unemployment rate was 3.6% in 2023, unchanged from 2022. 

The U.S. Bureau of Labor Statistics’ estimate of the number of employed Kentuckians for 2023 was 1,941,994. This figure was down 6,318 from the 1,948,312 employed in 2022. 

The number of unemployed Kentuckians for 2023 was 84,269, up 2,307 from the 81,962 unemployed in 2022. There were 78,849 fewer individuals unemployed in 2023 than 10 years ago. 

In 2023, the estimated number of Kentuckians in the civilian labor force was 2,026,263. This was down 4,011 from the 2,030,274 recorded in 2022, and down 29,632 from 10 years ago when the civilian labor force was 2,055,895. 

Labor force statistics, including the unemployment rate, are based on estimates from the Current Population Survey of households. The survey is designed to measure trends in the number of people working. It includes jobs in agriculture and individuals who are self-employed.

Seven states experienced a statistically significant decrease in their annual unemployment rates from 2022 to 2023. While Kentucky’s unemployment rate increased in 2023, the rate for 2023 was not statistically different from 2022. Kentucky’s unemployment rate for 2023 was higher than 43 states, lower than four states, and equal to two states. Nevada had the highest unemployment rate in 2023 at 5.1%. North Dakota had the lowest rate at 1.9%. Among its surrounding states, Kentucky’s unemployment rate was lower than Illinois and higher than Indiana, Missouri, Ohio, Tennessee, Virginia and West Virginia.

“Kentucky’s unemployment rate increased from 2022 to 2023 as fewer people reported being employed and more reported seeking work,” said University of Kentucky’s Center for Business and Economic Research (CBER) Director Mike Clark, Ph.D. “While the unemployment rate increased from 2022, it was still very low by historic standards. The annual estimates also indicate that after two years of workers returning to the labor force following the pandemic, the number of people participating in Kentucky’s labor force declined in 2023.”

In a separate federal survey of business establishments that excludes jobs in agriculture and people who are self-employed, Kentucky’s nonfarm annual average payroll employment in 2023 increased by 48,591 or 2.5% to 2,016,425 jobs, and 185,957 or 10.2% more than 10 years ago.

Nonfarm data is provided by the Bureau of Labor Statistics’ Current Employment Statistics program. According to this survey, all of Kentucky’s 11 major nonfarm job sectors listed in the North American Industry Classification System (NAICS) showed employment gains in 2023 compared to 2022.

The educational and health services sector expanded by 13,768 jobs in 2023 and gained 41,964 jobs or 16.1%, over the past 10 years. Employment in the healthcare and social assistance subsector increased by 12,892 positions in 2023 and gained 42,288 jobs over the past 10 years. Educational services in this sector include employees at private elementary, secondary and postsecondary schools along with other establishments that provide instruction and training. Education services added 875 jobs from 2022 to 2023 or 3%, and decreased by 325 jobs over the past 10 years.

The government sector, which includes federal, state and local employment in public education, public administration agencies and state-owned hospitals, added 8,481 jobs or 2.8% in 2023. Employment in this sector was down 16,006 jobs over the last 10 years or 4.9%. During the past year, employment was up 1,263 jobs in federal government, 3,616 positions in state government, and 3,602 jobs in local government.

Employment in Kentucky’s leisure and hospitality sector expanded by 7,415 positions in 2023, and 24,346 jobs in the past 10 years. The majority of these gains occurred in accommodation and food services, which added 5,527 positions in 2023. The arts, entertainment and recreation subsector added 1,888 jobs from 2022 to 2023.

Kentucky’s construction sector expanded by 6,116 jobs in 2023, or 7.3%. The sector has increased by 21,477 jobs or 31.5% since 2013.

“Kentucky’s construction sector posted strong employment gains for 2023 with an increase of 7.3%,” said Clark. “Nationally, construction employment grew by only 3.3%.”

Other services, a sector that includes repair and maintenance; personal and laundry services; and religious, civic, and professional organizations, rose by 4,308 jobs in 2023. The sector added 7,034 positions or 10.9% in the last 10 years.

Kentucky’s manufacturing sector gained 4,152 jobs or 1.6% in 2023 for a total of 256,203 positions. Over the past 10 years, manufacturing employment was up 27,146 jobs or 11.9%. Durable manufacturing went up 3,368 jobs or 2.1% from 2022 to 2023 and non-durable manufacturing added 784 jobs or 0.9%.

“Kentucky’s manufacturing sector saw strong growth during the first half of the year but gave up some of this growth during the last half,” said Clark. “Even with a weaker second half of the year, Kentucky’s manufacturing employment grew faster than the 1% national growth.”

Kentucky’s trade, transportation, and utilities sector added 2,017 jobs or 0.5% in 2023. During the past 10 years, the number of jobs increased by 57,053 jobs or 15.4%. This is Kentucky’s largest sector based on employment with a total of 426,959 positions or 21.2% of Kentucky’s nonfarm employment. Within the sector, wholesale trade gained 2,133 jobs from 2022 to 2023, retail trade lost 266 jobs, and transportation, warehousing, and utilities gained 149 jobs.

The information sector, which includes establishments involved in publishing, internet activities, data processing, broadcasting and news syndication, grew by 1,167 jobs in 2023 from a year ago. It lost 1,064 jobs or 4.4% compared to 10 years ago.

Firms in the state’s professional and business services sector increased by 617 jobs in 2023 or 0.3%. This sector includes professional, scientific and technical services; management of companies; and administrative and support management. In the last 10 years, the sector has grown by 24,957 jobs or 12.2%. Within this sector, professional, scientific and technical services added 2,567 positions from 2022 to 2023, management of companies had 1,156 more jobs, and administrative and support and waste management lost 3,105 positions.

Employment in the mining and logging sector rose 5% with a gain of 413 jobs in 2023. Over a 10-year period the sector decreased by 8,820 positions. Other industries included in the sector are forestry; oil and gas extraction; and support activities for mining.

The financial activities sector grew by 136 positions from a year ago. Over the past 10 years, this sector has added 7,870 jobs or 8.9%. Within this sector, the finance and insurance subsector decreased by 796 positions in 2023, while real estate, rental and leasing increased by 932 jobs.

Unemployment statistics are based on estimates and are compiled to measure trends rather than actually to count the number of people working. Civilian labor force statistics include non-military workers and unemployed Kentuckians who are actively seeking work. They do not include unemployed Kentuckians who have not looked for employment within the past four weeks.

Learn more about Kentucky labor market information at http://kystats.ky.gov/KYLMI.

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