Jobs, labor force continue to deteriorate

ALBANY, Ga. -- Hope has yet to be restored in the job market.

The Georgia Department of Labor reported Thursday that the state's seasonally adjusted unemployment rate had declined to 9.9 percent in July, one-tenth of a percentage point lower that what it was the previous month.

Labor Department officials are attributing the drop in the unemployment rate to a decline in the labor force brought on by long-term unemployed workers becoming discouraged and giving up their job search. Coupled with the increase of 19,026 workers in June, Georgia's labor force has deteriorated by more than 40,000 during the past two months.

"Georgia's job market continued to deteriorate for the second consecutive month," State Labor Commissioner Michael Thurmond said in a news release. "Although the unemployment rate remained virtually unchanged, a growing number of discouraged workers dropped out of the workforce. For the second consecutive month, the number of jobs in our state declined, new layoffs increased and long-term unemployment continued to rise."

This is the first time in nine years the state has experienced significant reductions in the labor force for two consecutive months.

Long-term unemployment is defined by being out of work 27 weeks or longer. There were 230,000 long-term unemployed Georgians in July, which represents an increase of 108,900 from July 2009 -- and an increase of 100 from June. The long-term unemployed now account for 49.8 percent of the 462,372 jobless workers in Georgia.

"The job market remains weak as more job seekers are getting more discouraged," said Aaron Johnson, assistant professor of economics at Darton College. "We are starting to see a decline in manufacturing activity as firms are becoming more hesitant to boost production as they expect consumers to hold back on future spending. Therefore, we are seeing weaknesses in that area and that might extend to the Albany area.

"Another issue is the fiscal pressures faced by state and local governments. Due to budgetary pressures, they have had to resort to layoffs and cutoffs of services. This has also impacted our area negatively."

In July, 68,089 laid-off workers filed initial claims for unemployment insurance benefits, an increase of 3,295 from June. There was a decline of 25,899 initial claims from the 93,988 filed in July 2009. Most of the first-time claims were filed in manufacturing, wholesale and retail trade, administrative and support services and construction.

The number of payroll jobs in July decreased by 21,600, or sixth-tenths of a percentage point, from 3,827,200 in June. The number of jobs remain less than what they were in July 2009, when there were 30,400 more than this year.

Statistics provided from the Labor Departments also show that Albany gained 400 jobs during the year. The number of initial unemployment insurance claims filed in the area has declined by 150 since July 2009. The preliminary unadjusted unemployment rate for Albany was 11 percent in June.

This is the 34th consecutive month Georgia has exceeded the national unemployment rate, which is currently 9.5 percent.