Unemployment in N.C. hit 11 percent in October

By: Richard Craver | JOURNAL REPORTER
Published: November 21, 2009

The state's economy continued to spin its wheels in October, with the jobless rate remaining above 10 percent for a ninth consecutive month.

The unemployment rate also rose for the first time in five months, increasing to 11 percent from 10.8 percent in September, the N.C. Employment Security Commission reported yesterday.

A major factor in the higher jobless rate is that 4,537 more North Carolinians were considered as unemployed for a total of 496,279. The state's labor force also decreased by 1,105 to about 4.5 million. Those numbers are seasonally adjusted by the commission.

Since the recession began in December 2007, North Carolina has shed 240,100 jobs.

"Right now, there is a tremendous amount of idle labor in North Carolina, both in terms of unemployed individuals and those who are effectively jobless but are not included in the official statistics," said John Quinterno, a principal at South by North Strategies Ltd., a research company focused on economic and social policy

Some economists have said that if the underemployed -- those working in jobs below their skill level for the sake of earning a paycheck, the stay-at-home parent, the retiree and the discouraged -- are factored into the jobless rate, it could be as much as 2.5 percentage points higher.

Mark Vitner, a senior economist for Wells Fargo Securities LLC, said that the rise in the unemployment rate was not unexpected.

"The pace of layoffs appears to be moderating across the state but still remain way too high," Vitner said. "Few firms are hiring right now and, with the labor force beginning to show signs of rebounding, the unemployment rate may rise as much as a full percentage point higher."

Moses Carey Jr., the chairman of the commission, took a half-full approach to the rate increase.

"We've had ups and downs concerning the number of people employed and unemployed, but we haven't experienced any significant changes," Carey said.

"We are working as quickly as possible to implement the new extension of benefits for those individuals who have exhausted or about to exhaust their benefits."

On Nov. 6, President Obama signed a $24 billion economic-stimulus bill into law. It provides another 14 weeks of benefits to all out-of-work people who have exhausted their benefits or will do so by the end of the year, estimated at nearly 2 million.

Those in states where the jobless rate is 8.5 percent or above --a group that includes North Carolina -- get an additional six weeks.

Despite the rate increase, the commission reported that most employment categories had net gains during October. There was a net gain of 5,800 government and 5,600 education and health-services jobs, along with 2,600 in professional and business services and 1,900 in manufacturing.

There was a loss of 6,600 construction jobs during the month -- among the largest concentration of losses in that sector in the country.

"Even though labor-market conditions have improved slightly over the past three months, the level of growth is insufficient to make much of a dent in the current situation," Quinterno said.

"Consumer demand is weak, economic conditions are uncertain and employers have many alternatives to adding full-time positions. Absent increased demand, North Carolina's labor market will limp along well into the future."

Vitner said that the economy may be moving forward enough "to benefit some industries important to North Carolina."

"Inventory reductions appear to be coming to an end, and we are seeing some tentative signs of recovery in the transportation and distribution sector," Vitner said.

rcraver@wsjournal.com

727-7376

Exhausting benefits

This chart shows by county how many people are expected to exhaust their unemployment benefits in the next few months. The timeline began Monday. These numbers may change with the recent extension of benefits approved by the federal government.

County - Next 60 days - 61-120 days - 121-180 days - Over 180 days

Alamance - 193 - 345 - 1,636 - 8,406

Alleghany - 9 - 16 - 90 - 531

Ashe - 36 - 61 - 282 - 1,617

Davidson - 289 - 418 - 2,025 - 10,111

Davie - 42 - 84 - 414 - 2,294

Forsyth - 448 - 766 - 3,117 - 14,754

Guilford - 620 - 1,187 - 5,271 - 23,732

Randolph - 213 - 350 - 1,613 - 9,913

Rockingham - 164 - 280 - 1,055 - 6,232

Stokes - 65 - 87 - 449 - 2,470

Surry - 116 - 188 - 752 - 4,081