In May 2020, research company Chmura released data detailing the economic vulnerability index across Kentucky counties. This index measures how the COVID-19 pandemic could negatively impact a county’s employment due to industry mix. The index uses a baseline of 100 for the national average. Numbers below 100 demonstrate lower vulnerability, and numbers above 100 demonstrate higher vulnerability.
In the GRADD region, six of seven counties were expected to do better than the national average, with only McLean County predicted to be slightly more impacted at 104.79. Hancock County was considered one of the least vulnerable across
the whole state, with an index of 45.29. This lack of expected vulnerability was due to Hancock County’s strong mix of low COVID-19 impacted industries. Supply chain issues were an ongoing threat to many businesses nationwide, even well after
the height of the pandemic. These issues affected everything from small businesses to big box stores, as well as local utility providers trying to locate replacement parts.
As the pandemic’s economic impacts spread across the nation, wages generally fell as businesses were impacted. Throughout the pandemic, Hancock County consistently maintained the highest average weekly wages in all of Kentucky. In quarter three of 2020, wages were over $200 more than the next highest county in Kentucky and $400 more than the next highest in the GRADD region.
Early in the pandemic, eviction prevention was a priority at both the federal and state levels. Extensions of eviction moratoriums prevented a vast amount of people from instantly becoming homeless due to the economic downturn.
Henderson County did not see an increase in homelessness during the pandemic, but local officials planned for the impacts of the end of the moratorium. Officials gathered a committee to create a strategic plan for a possible increase in homelessness. They kept in close contact with other local officials and presented the situation at Chamber of Commerce meetings. Plans for a temporary shelter were ready to be implemented if needed.
The Owensboro Metropolitan Statistical Area, which includes Daviess, Hancock, and McLean Counties, is the only MSA out of 389 in the U.S. where unemployment decreased from June 2019 (4.4%) to June 2020 (4.2%), despite the economic disruption caused by COVID-19.1 The unemployment rate the month prior in May 2020 as 14%. The sudden decrease shows how quickly the Owensboro MSA was able to recover from the initial shock.
This recovery was thanks to the diverse economy of the Owensboro MSA. With several large employers across the area, no single industry held most of the jobs. Many large employers in the area were deemed essential during the pandemic. Owensboro Health Regional Hospital, Green River Distilling, and Unifirst provided goods and services essential to pandemic response like healthcare, alcohol for sanitizing, and PPE. Despite the temporary discontinuation of several services, Owensboro Health kept all employees on payroll.
Other workers in the region make Ragu spaghetti sauce at Mizkan America, Inc, which became important as Americans stayed home for meals more often. Owensboro hosts one of US Bank’s largest mortgage processing centers. Low interest rates and a high demand for housing kept the mortgage industry busy. Kimberly-Clark kept up with the demand for toilet paper, diapers, and other essential products. The agriculture industry is also a large employer. Despite temporary closures of Aleris (aluminum) and Domtar (paper), most of Hancock County’s major industries continued operation.
As of June 2022, the region’s unemployment has remained steady after the initial spike in 2020. Kentucky’s unemployment rate in April 2022 was 3.9%, nearly one fourth of the height of the 16.5% it was in April 2020.
Previous staff cuts, location closures, and an outdated IT system brought challenges to the management of Kentucky’s unemployment during the pandemic. It took some individuals months to receive aid after applying. Others waited nearly a year. Changes were made throughout the pandemic, including new user interfaces and heightened digital security.
In April 2021, Governor Beshear created the Kentucky Unemployment Insurance Fraud and Prevention Task Force (EO 2021-230) to investigate the surge in fraudulent unemployment insurance claims. Also in April, thirteen career centers, including one in Owensboro, opened to in-person unemployment insurance services. Ninety additional UI office jobs were funded to address the high demand.
McLean County experienced the greatest negative impact in unemployment across all of Kentucky. From September 2019 to September 2020, 400 less people were employed in the county, a 25.2% negative change. This impact is reflective of the Economic Vulnerability Index discussed earlier, in which McLean County was estimated to be the most vulnerable to negative impacts based on types of industries present and how they were impacted by the pandemic.