At 7.8 percent, Ohio's unemployment rate is the highest the state has seen since January 1987.
The current rate is both a symptom of a downward spiraling economy and a burden on state finances.
"Ohio and most of the Midwest have suffered a lot of losses in manufacturing, that's the biggest contributor to this area," said Brian Harter, communications officer of the Ohio Department of Jobs and Family Services (ODJFS). "The economy overall, throughout the country, has gone downhill."
There are currently 454,800 unemployed Ohioans. The count of unemployed people includes all state citizens who are not employed but who are actively seeking work, waiting to be called back to a job after a layoff or waiting to report within to a new job within 30 days.
William Even, a Miami University professor of economics, said the national recession affects Ohio's job market in specific ways.
"Nationally, the unemployment rate is at 7.2 percent and in Ohio it's at 7.8 percent," he said. "Ohio is the state, second behind Michigan, that's biggest on auto parts production, and obviously, the auto industry has been hit harder than many. That makes our economy a bit more susceptible to this recession. Ohio has a manufacturing-heavy economy, and that's hurt us relative to other states."
Even said Ohio's major industries have faced major declines, with mass layoffs on the rise.
"Construction's gone down 8.5 percent in a year; manufacturing's down 5.5 percent," Even said. "Those are the two largest declines. In addition, the housing and auto markets' decline has played a significant role in the state's recession."
Ohio's unemployment rate reached 7.8 percent in December, according to data from the U.S. Department of Labor. The yearly unemployment average was 6.6 percent in 2008, up from 2007's 5.6 percent and the highest average in 15 years.
The increase in unemployed Ohioans has contributed to the state's inability to provide federal unemployment compensation to citizens, according to ODJFS.
"The funding process hasn't changed, but the trust fund that normally pays for unemployment benefits has run out," Harter said. "Simply put, more money was coming out of the unemployment trust fund than tax revenue going in. Add to that the increase of claims on unemployment benefits, and there weren't enough funds."
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To cover unemployment funds, ODJFS has opened a line of credit with the U.S. Department of Labor, allowing the state to borrow up to $250 million in January and $250 million in February. Harter said he estimates that ODJFS stayed well under the maximum borrowed amount in January, collecting around $145 million.
"We're going to have to pay back whatever we borrow through tax revenue," Harter said. "There are going to be changes in the law concerning how we bring in money for unemployment compensation."
In his State of the State address Jan. 28, Strickland said the 2009 budget has been decreased from planning levels by $3.2 billion to limit Ohio's deficit. He stated that a number of program reductions will take place, but that taxes on Ohioans will not be raised.
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