Despite decreases in most economic growth categories, including personal income, a monthly financial report said Ohio’s economic recovery was ahead of the national recovery.
The September report prepared by the Ohio Office of Budget and Management said the state was at 87% on an index tracking economic recovery, developed by research firm Moody’s Analytics and CNN. The index rates states and the nation on 62 indicators of economic activity, ranging from no economic activity to 100% of pre-pandemic levels.
The “back-to-normal index” placed the nation at 81.2% recovery.
Unemployment dropped in the state in August, but remained at 8.9%, above the national average of 7.9%. Unemployment in Ohio has also increased slightly the past three weeks.
The termination of the federal Pandemic Unemployment Compensation program caused a drop in personal income of $543.5 billion around the country in August alone. Unemployment insurance benefits were reduced by 52% after the compensation program was terminated, a reduction of $633.5 billion nationally.
The OBM’s report said a national survey of small business owners found positivity about the future, despite the pandemic. The uncertainty continues, however.
“Even as states reopen, revenues in certain sectors remain lower and small businesses are working hard to recover,” the OBM report stated. “However, many in the service industry are still struggling and remain uncertain about their futures.”
Overall employment in Ohio rose by 0.9% from July to August, but remained down 8% compared to last August.
Education and health services saw a rise of 12,300 jobs and government rose 7,800 jobs, followed by professional business services (7,500), trade, transportation and utilities (6,800); leisure and hospitality (4,500) and manufacturing (4,500).
“Even with these gains, employment in all sectors was below August 2019 levels due to the economic effects of the pandemic,” the OBM stated.
Losses were recorded in construction and information sectors.
The state’s gross domestic product fell 33%, slightly more than the national average drop of 31.4%.
Declines in durable goods and manufacturing, and health care and social assistance topped the categories bringing down the state’s GDP. Both fell by more than 4%, followed by accommodation and food service (3.7%), transportation and warehousing (2.6%), wholesale trade (2.4%) government and government enterprises (2.3%) and arts, entertainment and recreation (2.1%).
The finance and insurance sector saw the only growth in the state, though the gains were only 1.4%.
The OBM report noted a 16.2% decline in passenger vehicle miles traveled between August and September, but a 2% increase in commercial vehicle travel on the Ohio Turnpike.
Also noted on the report was an increase in cigarette taxes, more than 14% above estimates for the year. The state budget department said the increase in revenues continues amid and because of the pandemic.
“Revenues from this source have demonstrated growth as the pandemic wears on and the personal and economic impacts are felt by the public,” the report stated.