State’s labor force drops

ALBANY — As the state’s unemployment numbers continue to linger within the double-digit range, it appears as those directly impacted by the recession are beginning to lose confidence.

The Georgia Department of Labor reported Thursday that the state’s seasonally adjusted unemployment rate had declined to 10.0 percent in June, one-tenth of a percentage point lower than the previous month.

The state’s labor force shrunk by 17,953 in June, the largest month-to-month decline since May 2001. The number of payroll jobs last month decreased by 9,400, or two-tenths of a percentage point, from May. The number of jobs remain less than this time last year with the difference being at 1.3 percent, or 49,600 jobs.

Officials now believe that long-term unemployed workers have lost hope for finding jobs.

“From a national perspective, what’s happening is that there are five applicants for one position and that there are highly-skilled people out there who can’t find work,” explained Aaron Johnson, assistant professor of economics at Darton College. “When you get rejected, it takes a psychological toll.”

The Labor Department is using the decline in the labor force to support this theory.

“This is a very difficult job market,” said State Labor Commissioner Michael Thurmond. “I encourage them (the unemployed workers) to keep the faith. Things will get better, but it will be later rather than sooner. There is no quick fix.

“We are in tough times, but not hopeless times.”

In June, there were 230,000 long-term unemployed Georgians — a status defined as those out of work 27 weeks or longer. This represents an increase of 123,900, or 116.8 percent, from the 106,100 long-term unemployed in June 2009 as well as a 1.9 percent increase from May.

The long-term unemployed account for 49 percent of the 469,022 jobless workers in Georgia.

Also in June, 64,794 laid-off workers filed initial claims for unemployment insurance benefits, an increase of 6.875, or 11.9 percent, from May. There was a decline of 23,962 initial claims from the 88,756 filed in May. Most of the first-time claims were filed in wholesale and retail trade, manufacturing and construction and administrative and support services.

“I would be interested to see what happens in future months,” Johnson said. “As we head into the summer months we’ll have a better picture of whether it’s getting worse or getting better.”

Increased competition from recent college graduates also has an influence.

“The number of new jobs needs to increase just to keep the (unemployment) rates constant,” Johnson said.

Albany showed a decrease in the number of initial claims filed from 1,402 in June 2009 to 1,269 the same time last year. The region meanwhile managed to gain 700 jobs, making for a 1.1 percent gain.

From a Southwest Georgia perspective, the key might be found in reinvesting in industries as well as skill sets.

“We need more industry to come to the area; we need to find ways to make them invest more,” Johnson said. “When we create jobs, we will be able to meet new skills.

“It’s important to increase human capital.”

This is the 33rd consecutive month Georgia has exceeded the national rate, which is now 9.5 percent.