Business

'Shocking': North Carolina unemployment hits 8.7%

Posted January 23, 2009 10:11 a.m. EST
Updated March 9, 2009 5:12 p.m. EDT

— Unemployment in North Carolina climbed to 8.7 percent in December, the highest jobless rate since June 1983, when the rate hit 9 percent.

“Shocking and sobering is the way I would describe today’s news,” North Carolina State University economist Mike Walden said.

As the grip of the global slowdown tightened on the N.C. economy, unemployment increased by more than 38,000 last month, according to the North Carolina Employment Security Commission.

Nearly 400,000 North Carolinians were unemployed but seeking work, which is a record number, the ESC said. The number of unemployed has jumped by 185,000 in the past year, according to the agency.

Walden warned that more bad news is on the way.

“The worst isn't here yet,” he said. “We will hit 10 percent unemployment this year. This recession is shaping up to be the worst in the post-World War II period.”

The December jobless rate was nearly a full percentage point above the 7.8 percent rate in November. Since September, the unemployment rate has climbed nearly two percentage points.

In January 2008, the jobless rate stood at 4.9 percent.

The national jobless rate in December was 7.2 percent.

“Layoffs continue to hamper many job sectors throughout the state,” ESC Chairman Moses Carey Jr. said.

The hardest-hit sectors are retail and professional services associated with development, such as landscapers, lawyers and accountants who work closely with construction, officials said.

After reviewing the jobs data and noting North Carolina’s projected $2 billion deficit for the current fiscal year, Walden saw a couple of glimmers of hope.

“The only bright side I can see (is that) health care jobs continue to increase, and North Carolina's budget hole, on a relative basis, isn't as big as in many other states," Walden said.