Indiana's unemployment rate drops to 5.4 percent

Indiana's unemployment rate dropped nearly half a percentage point in April — among the best one-month improvements in the country — but some economists say the jobs outlook remains mixed.

The April unemployment rate was 5.4 percent, down from 5.8 percent in March, according to the U.S. Bureau of Labor Statistics. Only one other state — Washington — improved as much.

The lower rate came as Indiana added 10,600 jobs in April, according to the Indiana Department of Workforce Development. Trade, transportation and utilities led the way. There was also positive growth in construction and in professional and business services. There were job losses in financial activities and manufacturing.

Those additional jobs nudged the state's private-sector job count nearer to the state's all-time high number of jobs — a level not seen since March 2000. The state is now 7,800 jobs shy of that number.

Gov. Mike Pence issued a statement saying Indiana's economy continues to gain momentum. "Indiana is proving once again that we are a state that sets the bar high for growth and opportunity," Pence said. And Steven J. Braun, commissioner of workforce development, said the reduction of continuing claims for unemployment insurance means "Hoosiers are returning to work at a substantial rate."

Others took a more sober view of the numbers.

While state's number of jobs is nearing the all-time high reached it March 2000, the state's population has grown by more than 500,000 people since then, says Derek Thomas, a senior policy analyst with the progressive Indiana Institute for Working Families. He noted that for the fourth straight month fewer people are participating in the state's labor force, one of the largest participation declines in the country.

Overall, Indiana's economy seems to be operating on a parallel path to a national economy that could be best described as having "anemic" growth, said Indiana University economist Willard Witte. The substantial drop in Indiana's April rate means the state has caught up with the national average in unemployment, which is also 5.4 percent. He said a real test for Indiana will come in the months ahead as the energy industry's performance softens and the Federal Reserve considers raising interest rates.

As for the current numbers, Witte said, "I don't really read a lot into it."

Compared to its neighbors, Indiana jobless rate is middling. Indiana has a better unemployment rate than Illinois (6%) and an identical rate to Michigan (5.4%). But Indiana's rate remains higher than Ohio (5.2%) and Kentucky (5%).

Witte said Indiana's performance looked better, comparatively speaking, in the months following the end of the recession in 2009. That's because manufacturing, still so vital to the state, was among the first sectors of the economy to show improvement. As the recovery has continued, the gains in manufacturing have leveled off.

Call Robert King at (317) 444-6089. Follow him on Twitter at @RbtKing.