August NC Unemployment Rate Drops To 8.7 Percent
RALEIGH, N.C. (AP) — North Carolina’s jobless rate resumed its downward trend in August after a one-month increase, the state Commerce Department reported Friday, even as the number of those employed fell overall.
The state agency said the August unemployment rate was 8.7 percent, compared with 8.9 percent the month before. The July rate was the first month-to-month increase since January, when the jobless rate was 9.5 percent. The national unemployment rate is now 7.3 percent, down from a peak of 10 percent during the recession.
North Carolina data show the number of employed people fell by almost 3,600 workers between July and August to nearly 4.3 million. But the number of unemployed fell by a greater amount, about 8,700, to 409,500 people.
The trend of falling unemployment rates across the country has come, in large part, due to the number of people who stopped looking for a job. The government does not count those people as unemployed.
Mark Burkey, an economics professor at North Carolina A&T State University in Greensboro, pointed to raw data not adjusted for seasonal peaks and valleys as showing a 1.4 percentage-point decline in the unemployment rate since August 2012.
“Overall, I’m very encouraged at the decrease,” Burkey said in an interview. “I was increasingly encouraged last month, and even more encouraged this month.”
Burkey wondered whether recent state changes in unemployment benefit rules may have contributed to the August decline. Starting July 1, the maximum monthly benefit for the newly jobless fell by about one-third. The reduced benefits also meant extended federal benefits for the long-term jobless ran out to about 70,000 people. Reduced or eliminated benefits may have led some people to take employment they might not otherwise have taken before, Burkey said, such as in a different field or for reduced pay.
“That should give theoretically people an incentive to look harder to find a job,” Burkey said.
Allan Freyer, an analyst with the liberal-leaning N.C. Budget & Tax Center, called the August numbers “terrible.” The center said the lower rate masks deeper problems. The overall month-to-month decline of the state labor force by more than 12,000 people is a sign people are giving up on the job search, the center said.
The commerce agency said the professional and business service sector saw the largest employment sector increase from July to August at 3,300 positions, followed by education and health services and the trade, transportation and utility fields.
The government sector, which includes public education, saw the largest sector decline at 6,800 positions. Summer is often a transition time for school teachers and universities as the state budget is finalized and many K-12 teachers are waiting on new positions.
Burkey said there was essentially a hiring freeze at North Carolina A&T through August as the legislature completed its spending plan and university administrators figured out reduced spending allocations. “There have been real budget cuts,” he added.
North Carolina’s rate, which had been tied for third-highest in the nation in July, is now tied for sixth-highest, along with Georgia and the District of Columbia, according to the federal Bureau of Labor Statistics.
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