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New N.C. jobless figures 'not good,' economist says

Posted August 20, 2010

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— North Carolina’s unemployment rate dropped under 10 percent for the first time in more than a year to 9.8 percent in July.

However, the state’s Employment Security Commission also reported Friday that the number of non-farm jobs in the state decreased by nearly 30,000.

“Overall, the July state employment report was not good.,” N.C. State economist Dr. Michael Walden said.

 “Although the unemployment rate dropped, this was entirely due to over 35,000 people dropping out of the labor force,” he said. “Some of this may have been college kids leaving summer jobs early, and therefore may not have been accounted for by seasonal adjustments. But, the number of employed workers fell in both the household and employer surveys.”

Economist: True unemployment rate tops 15 percent Economist: True unemployment rate tops 15 percent

The government uses surveys to determine job totals.

The unemployment rate is based on people working or seeking work and those receiving unemployment benefits.

People no longer seeking work are not included in the jobless rate.

The jobless rate was 10 percent in June. A year ago it was 11 percent.

The last time North Carolina’s jobless rate was lass than double digits was 9.8 percent in February 2009.

The U.S. unemployment rate is 9.5 percent.

“Job growth across all sectors continues to be a challenge,” said ESC Chairman Lynn R. Holmes in a statement. “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,” she added.

The seasonably adjusted employment number, based on surveys of employers, showed a drop of 29,800 jobs. Of those, 27,300 were government positions.

The transportation and utility sector reported a net gain of 2,800 jobs.

Walden said private sector numbers were encouraging but added that the public sector is now taking hits in employment.

“On the plus side, four private sectors added jobs - manufacturing, trade, information, and financial services. In total, private sector employment fell by 2,500,” Walden explained.

“The big drop in employment was for local government, which shed 26,500 jobs. These are not [part-time] Census jobs,” he stressed. “This reduction in local government employment suggests city and county governments - which have seen their revenues drop - have being forced to adjust by paring their workforce. So the big job losses may have shifted from the private sector to the public sector.”

Some tech-related segments did report job growth. Financial activities jobs increased by 600 from June.

Over the past year, information jobs are up 900, and professional and business services have climbed by 19,700. That’s the largest sector of jobs growth over the past 12 months.

Walden stood by his earlier predictions that North Carolina will add jobs this year, albeit slowly.

“Going forward, I still predict we will add jobs in North Carolina over the rest of the year, but the pace of improvement will be slow,” he said. “Most forecasters have revised downward their predictions for economic growth in the second half of 2010 and early 2011.

“The key to economic recovery is households repairing their financial balance sheets by reducing debt and increasing saving. Households are doing this, but this means consumer spending will barely increase. And since 70 percent of the national economy is based on consumer spending, a frugal consumer means a slow economy.”

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  • Peace Love and Cold Meds Aug 20, 2010

    no kidding, i'm shocked. maybe that's why I have no business, cause everybody is broke, laid off, fired or flat cheap. either way, lots mo' people gonna get mo' time on the sofa over the next year or 2 and guess who ain't doin' a thang to help any of us, BEV PuDoo.

  • mtnmama Aug 20, 2010

    Not even bothering w/reading these comments. The rate is much higher that the numbers report because so many have exhausted UE benefits & no longer counted. Still no jobs. We keep outsourcing everything...that's part of the problem. And shame on the state of NC for keeping a contract w/BCBS for health benefits after they announced plans to ship jobs to Philipines! They say no state program jobs are leaving, but still, this should cause an uproar among tax payers!....there should be a huge tax levied on businesses who send jobs outside the US...this should be used to fund unemployment!

  • justiceforall Aug 20, 2010

    I'm shocked.

  • WRALSUCKS Aug 20, 2010

    "Everybody works for 4 days a week. That way we all have a job and 3 weekend days to spend on consumer products."

    Go see how the French 36.5 hour mandated work week has worked out for them.

  • Plenty Coups Aug 20, 2010

    More links on when the Great Depression ended for nighttrain.
    http://www.museum.siu.edu/museum_classroom_grant/Museum_Explorers/school_pages/bourbonnais/page6.htm

    http://en.wikipedia.org/wiki/Great_Depression
    http://useconomy.about.com/od/grossdomesticproduct/p/1929_Depression.htm
    http://www.cliffsnotes.com/Section/Why-does-The-Great-Depression-end-when-the-United-States-enters-World-War-II-.id-305402,articleId-67247.html

  • MakoII Aug 20, 2010

    nighttrain2010,

    I'm with you to a point. I have no problem with a retirement system. Even if it was privatized, as long as it was safe municipal bonds. End the Empire. All for it.

    Can't argue with you there.

  • Plenty Coups Aug 20, 2010

    goobnav-"How about World War II? Started in 1941, ended in 1945, all after production took until 1948?"

    You mean when the govt. borrowed all that money to build weapons and employ soldiers? (reminder: war bonds=government borrowing)

  • Plenty Coups Aug 20, 2010

    nighttrain-WWII did end the Depression. It's not in dispute nor can it be by serious people who look at the official indicators of what an economic recession is. Unemployment vanished and the economy made tremendous gains. You providing a link to one person's tortured opinion doesn't prove anything when faced with the defintions of what a recession is. The vast majority of economists disagree with this article. Here is a couple of different opinions.:
    http://www.theatlantic.com/business/archive/2009/02/did-world-war-ii-end-the-great-depression/4724/

    http://www.amatecon.com/gd/gdoverview.html

  • nighttrain2010 Aug 20, 2010

    >>Also a great article on not cutting taxes!

    MakoII, if we're going to have the government waste and gimme society that was created under FDR, Johnson, Bush, Obama, and numerous other Presidents we are going to have to continue to unfairly tax the citizenry. However it should not be so high that those on the cusp of any class are discouraged to the point of not trying to reach the 'next level'

    Of course, we could do what I would advocate and that's to do away with 90% of the government handouts (phase out Social Security, cut Medicare out completely, Medicaid for only the most needy, quit playing Empire and bring home the troops from throughout the world, etc.). That would right the economy as well. Although too many politicians are on the dole and know what makes their hapless mass of constituents happy so I doubt that's going to happen anytime soon

  • goobnav Aug 20, 2010

    How about World War II? Started in 1941, ended in 1945, all after production took until 1948? That's when the first new model cars came out after the war? That carried the economy to maybe '56. Everybody had a house a job, supply out wieghs demand, need I say more?

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