According to statistics released by the Employment Security Commission of North Carolina on Friday, the state unemployment rate dipped to 9.8 percent in July, marking the lowest rate since last January. Total employment, however, decreased by 29,800 jobs as the state’s labor force continues to shrink.
“The decline in the unemployment rate is masking the reality in the labor market,” Alexandra Forter Sirota, a policy analyst with the North Carolina Justice Center’s Budget and Tax Center, said. “The number of people missing from the labor market is at an all-time high and the state continues to lose jobs.”
North Carolina’s labor force declined by 35,612 workers from June, which accounts for the decrease in the unemployment rate, despite the loss of jobs. Since the start of the country’s recession in December 2007, Sirota said North Carolina’s labor force has declined nearly five times the national average. If more jobs are not created, the unemployment rate will inevitably go back up. Sirota added that the state’s job shortfall, or the number of jobs needed to keep pace with the growth in the working age population and replace lost jobs, grew in July to more than 425,000 jobs.
“Without greater focus on preserving and creating jobs and encouraging more North Carolinians to re-enter the labor market, it is very likely that the unemployment rate will eventually increase,” said Sirota. “Job preservation and creation must be the primary goal of our state and federal policymakers if North Carolina is to achieve a full economic recovery.”
A large majority of job losses in July were in government with a decrease of 27,300 workers. Trade, Transportation and Utilities, however, saw an increase of 2,800 jobs, and total non-farm employment has risen by 6,000 jobs since last July. The total number of unemployed workers in the state checked in at 440,387.
“Job growth across all sectors continues to be a challenge,” ESC Chairman Lynn Holmes said. “We experienced job growth in some sectors but had a large loss in government due mostly to declines in local school employment. We would like to see more consistent growth throughout all job sectors. Our staff across the state continues to focus its efforts on providing assistance to those looking for work and in need of benefits.”
With a majority of the job losses coming in local school districts, Sirota said recently passed education funding totaling $300 million for North Carolina could help hundreds of educators who lost their job in July. Construction work has been the hardest hit by the recession as 32 percent of jobs have been lost, and 18.6 percent of all manufacturing jobs are gone. Workers who still have a job in manufacturing are working less, losing an estimated two weeks of work a year, Sirota reported.
In July, the ESC paid out $138 million in unemployment benefits.
Staff Writer Eliot Duke can be reached at 888-3578, or duke@tvilletimes.com.
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