Ohio’s job market took a double hit in September, with unemployment rising and labor force participation falling, analysts report.
The number of jobs in some sectors appears to be falling in the face of rising prices and interest rates. Meanwhile, people are leaving the labor force as the state ages, working-age immigrants are deported and wages fall relative to inflation.
The Ohio Department of Job and Family Services last week reported that the state’s employers shed 5,000 jobs last month, according to Policy Matters Ohio. Unemployment rose from 3.3% in August to 3.4%, and inflation rose from 3.4% to 3.7%.
Meanwhile, participation in the labor force continued a decline that started in June of 2025. By September, Ohio’s participation rate stood at 61.2% compared to 61.8% nationally, according to the Buckeye Institute.
The reasons for falling workforce participation can be complex.
The measure doesn’t consider people who have aged out of the workforce, only those who are of working age and able-bodied, but not looking for a job. Those people are not counted in the unemployment rate.
Policy Matters reported that Ohio’s working-age population grew by 4,000 in September, yet labor force participation fell.
Before employers began pulling back in recent weeks, more jobs seemed to be available. President Donald Trump’s mass deportations appeared to remove many of the 2 million foreign-born men who left the country over the past two years, and 80% of whom were employed.
However, many of their jobs were in sectors such as construction and agriculture that native-born workers can be reluctant to fill.
In any case, the nonpartisan National Bureau of Economic Research in April found that large deportations hurt the labor force. Perhaps ironically, the study showed that they lead to drops in employment among native-born male workers.
Income inequality may also play a role.
Americans were already trapped in a post-pandemic affordability crisis when Trump began his second administration. Then he slapped high tariffs on most of the world and started a war with Iran, making it worse.
In a written statement Buckeye Institute Vice President of Policy Rea S. Hederman Jr. said inflation is making man Ohio workers poorer.
“While private-sector hiring was revised up from the August jobs report, September’s job losses kept private-sector employment flat over the past two months,” he said. “Ohio’s workers are struggling as inflation-adjusted wages have fallen over the last year.”
Ironically, people can become so financially stressed that they can’t afford to work. Things such as child care, transportation and even clothing can make it not financially worthwhile to take a poorly paid job.
Molly Bryden, a researcher at Policy Matters Ohio, said lawmakers need to take such workers into account as they try to address an economy that has so many struggling.
“Combined with inflation and lackluster growth, this should be an early-warning signal to lawmakers,” Bryden said in a written statement. “Federal and state lawmakers must re-prioritize and focus on worker supports to draw people back to the labor force, expand pathways to quality jobs with family-sustaining wages, and restore affordability through shared prosperity — rather than pushing ‘pro-business’ policies that leave working families behind.”
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