N.C. unemployment remains 11 percent, but nearly 13,000 jobs were lost

Posted August 21, 2009 11:14 a.m. EDT
Updated August 22, 2009 8:02 p.m. EDT

— North Carolina’s unemployment rate appears to have stabilized with new figures showing the state’s jobless rate at 11 percent for July.

The jobless figure was 11.1 percent in May and 11 percent in June.

However, the July data from the North Carolina Employment Security Commission also shows that the number of people working dropped 12,997 to just over 4 million. That’s double the number of jobs lost between May and June.

The number of people seeking work also decreased in July. That drop of 4,853 to just under 497,000 helped offset the decrease in workers and kept the overall unemployment percentage at 11.

Because of those shifts, N.C. State University economist Michael Walden labeled the rate as “misleading.” He still believes unemployment will worsen to 12 percent or more by 2010 as he has forecast in earlier reports. North Carolina already has one of the nation’s highest jobless rates. Nationally, unemployment in July dipped slightly to 9.4 percent from 9.5 percent in June.

“The fact that the unemployment rate remained unchanged at 11 percent is, unfortunately, misleading,” Walden told “The state lost almost 13,000 jobs in July.

“The only reason the unemployment rate didn't increase was because of the 17,000 decline in the workforce,” he added. “We can expect that a large number of those who dropped out of the workforce are legitimately unemployed, but are not counted as such because they have stopped looking for work.

“Indeed, the job loss in July was higher than the number of jobs cut in June [some 6,000], so if anything, this indicates a slight worsening of the employment market in North Carolina.

“I still predict it will be next year before North Carolina begins to consistently add jobs.”

Larry Parker, a spokesperson for the for the ESC, pointed out some good signs in the report, such as 5,200 more people working in professional and business services. Those jobs include accountants, landscapers, engineers and other service providers.

“That increase could be a pretty good sign that firms are beginning to staff up,” he said.

More than offsetting the increase, however, was a loss of 21,300 government jobs. The figure includes teachers and other school district workers who aren’t on year-round pay schedules.

Parker did note that that the number of people receiving unemployment benefits fell to 234,803, a decline of nearly 6,000 from June. But he also acknowledged that the drop in benefits recipients as well as a decline in the size of the work force reflected a mixture of people who have “given up looking for work, have run out of benefits or have moved out of state.”

North Carolina’s unemployment rate in July 2008 was 6.3 percent.