Wednesday, March 11, 2009

Area Jobless Rates Climb to Levels Not Seen in More Than a Decade

Unemployment rates in the Washington region rose again in January to their highest levels in more than a decade, according to numbers released yesterday by the U.S. Bureau of Labor Statistics.

The District's unemployment rate in January jumped to 9.3 percent, from 8.2 percent in December, its highest point since the 1980s. Virginia's January unemployment rate rose to 6 percent, from 5 percent the previous month, the highest level since 1992. And Maryland's rate rose to 6.2 percent, from 5.4 percent, the highest since 1993.

The D.C. increase put the city's unemployment rate on pace to top 10 percent late this year or early next year, according to the Office of the Chief Financial Officer.

About 10,000 jobs were lost since January 2008 in professional services, transportation, utilities and other trades, according to a report by the D.C. Department of Employment Services.

"It's a major concern," said Robert Ebel, the city's chief economist. "We're worried about an accelerating effect."

City officials anticipated the job loss and 9.4 percent unemployment for January last year, said Fitzroy Lee, director of revenue estimation. "We've already built the impact into our revenue estimate," Lee said.

Ebel and Lee said the city's unemployment rate could surpass 11 percent in late 2010, a high not seen since December 1983.

"I don't know that . . . we've hit bottom," Lee said. "We have the unemployment rate going up to 11.5 next year. It's in line with other major urban areas. It means a lot of people are losing jobs."

In Virginia, where Circuit City, the technology retailer headquartered in Richmond, closed Sunday after filing for bankruptcy, the unemployment rate was also expected to continue to rise, though slowly.

"It will probably go over 6 percent," said William F. Mezger, chief economist for the Virginia Employment Commission. "We don't think it will go up a whole bunch above that. In the summer it will be high when the students are out of school, and it should drop again toward the end of the year."

Mezger said a statewide breakdown of unemployment data won't be prepared until tomorrow, so he could not discuss its impact. "I've been here 46 years," he said. "The last time it was this high . . . was in 1993, after the '91 recession. It got up to 8 percent in 1982 and 1983."

In Maryland, assistant secretary for labor, licensing and regulation Andy Moser said the unemployment rate is "the highest I've seen. I've been on the job for 10 years."

The state's unemployment rate rose to 6.8 percent in 1993 and went as high as 8.7 percent a decade before that, after the 1981 recession. Moser said the state had no estimate for how high the unemployment rate might go. "Obviously we're part of the national economy," he said. "We're not on an island."

Reflecting job losses nationwide, Maryland shed workers in construction, manufacturing and retail as consumers stopped spending. "You have to look at the state number in relation to the national number. Compare us to Pennsylvania, which is 7 percent," Moser said.

Michigan, at 11.6 percent, had the highest unemployment rate. Wyoming, at 3.7 percent, had the lowest. Michigan is home to the nation's struggling automakers. Wyoming thrives on agriculture.

South Carolina, Rhode Island, California and Oregon joined Michigan as the states with the five highest unemployment rates. North Dakota, Nebraska, South Dakota and Utah joined Wyoming as the states with the lowest.

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