Local jobless rates above 4 percent

Economic uncertainty last month conspired with winter to knock down the Capital Region’s labor force
PHOTOGRAPHER:

Economic uncertainty last month conspired with winter to knock down the Capital Region’s labor force and push its unemployment rate above 4 percent for the first time since July, according to statistics released Thursday by the state Department of Labor.

The region’s total nonfarm labor force in December shrunk by 700 jobs, or 0.2 percent, to 452,400, compared to a year earlier.

During the same period, the area’s unemployment rate jumped to 4.1 percent from 3.4 percent. The last time the unemployment rate stood above four percent in December was 2004.

Job levels declined last month partly because of softness in the leisure and hospitality and natural resources, mining and construction sectors, which were kept artificially high in late 2006 due to unseasonably warm weather. Those sectors over the year shrunk by 100 jobs to 32,100 and 200 jobs to 18,100, respectively.

“Whereas the weather is more normal this year, we’re not seeing that atypical number” in job levels for the construction and hospitality sectors seen late last year, said Labor Department market analyst James Ross.

Area retailers not surprisingly reported a 200-job decline in hiring, bringing their sector’s total to 53,200.

With high energy prices and the housing slump crimping consumer spending, retailers put the brakes on holiday season spending. The National Retail Federation earlier this week reported U.S. consumer spending in November and December rose by 3 percent compared to a year earlier — the worst holiday season results since 2002’s 1.3 percent uptick.

The December job statistics provided another indication that the region’s economy is slowing. But the region’s slowdown is not as severe as those of the state and nation, whose unemployment rates last month stood at 4.7 percent and 4.8 percent, respectively.

On the national scale, recession fears have been mounting. The Bush administration is exploring economic stimulus plans possibly involving tax cuts.

“[The local December data] certainly does not point toward a recession, but a recession would impact us,” said Ross.

During the nation’s last recession in 2001, the region’s labor force dropped to a low of 433,500 during the January of that year. It quickly recovered from the recession and the labor force peaked last June at 454,700.

Categories: News

Leave a Reply