Business - Business News

POSTED: Wednesday, Aug. 19, 2009

Whatcom unemployment rate drops as job seekers give up

Whatcom County saw a significant drop in the unemployment rate in the last month, but it appears to have little to do with job growth.

In July the unemployment rate was 7.8 percent locally, down from 8.3 percent in June. There were 8,660 people actively seeking work last month, a decrease of 700 compared to June, according to the Washington State Employment Security Department. However, there were actually fewer people working: 102,600 had jobs last month, down 370 from June.

Since about 70 percent of the people leaving the labor force last month were those actively seeking work, Whatcom County is going through a period where a significant number of people have fallen into the "discouraged worker" category - those who believe nobody will hire them right now, said Joe Giannamore, a regional labor economist for the state. There are also people leaving the labor force to do what is considered non-work activities.

"As (unemployment) benefits run out, people substitute looking for work to focusing on other things, such as going to school or working around the house," Giannamore said. "It is still a very difficult job market. I think the recession is coming to an end, but we may not start to see job growth until the first quarter (of 2010)."

In non-farm jobs, Whatcom County saw the number of jobs drop from 83,600 in June to 80,500 in July. Much of that drop was in state government, where there were 2,200 fewer jobs in July compared to June. The drop in state government jobs is normal for this time of year, Giannamore said, as the local colleges end regular sessions in June. What was unusual, he said, was the decline of 900 positions in local government

"That may be an indication that there were fewer local summer school or other programs than last year," Giannamore said.

One industry that did see some month-to-month growth was construction. There were 7,900 people employed in construction in July, up from 7,600 in June. Manufacturing had 8,000 people employed in July, which was equal to June's number.

Giannamore said he expects the unemployment number to continue to bounce around month-to-month, but be higher by the end of the year.

Statewide, the unemployment rate was 9.1 percent last month, down from 9.2 percent in June. The national rate in July was 9.4 percent, down from 9.5 percent in June.