Unemployment rate back on losing track


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The national unemployment rate rose again in August by three-tenths of a percentage point, hitting 9.7 percent and confirming economists' predictions that last month's slight dip did not signal better times had arrived.

The Bureau of Labor Statistics monthly report released yesterday had a few glimmers of hope, as the rate at which the economy is shedding jobs slowed slightly to 216,000 in August -- just a third of the monthly losses in the first quarter of the year.

The bureau reported 6.9 million jobs have been lost since the recession officially began in December 2007.

Investors responded to the unemployment news on a day of light trading before the three-day Labor Day weekend with the stock market showing modest gains in the major indexes. The Dow Jones industrial average gained 97 points.

Experts weren't willing to say that the slowing of job losses meant the recession is about to end. Instead, economists said the lower job losses in recent months reflected the effects of stimulus spending.

"The unemployment rate is going to continue moving up, possibly over the next 12 months," said Mark Price, an economist for the Keystone Research Center. "It's looking pretty certain."

Manufacturing and construction continued to be among the hardest hit industries during August with 65,000 construction jobs lost and 63,000 manufacturing jobs gone.

Health care grew again, adding 27,900 jobs in August with the more encompassing category of education and health services adding a combined 52,000 jobs.

While overall the retail trade sector was down 6,900 jobs in August -- which is better than the 69,000 retail jobs lost each month last winter -- Dean Baker of the Center for Economic and Policy Research pointed out that employment by auto dealers rose by 5,200 jobs last month to deal with the Cash for Clunkers business.

Revisions in numbers for June and July by the Bureau of Labor Statistics showed the economy shed 49,000 more jobs during those months than had previously been reported.

In his analysis on the monthly jobs report, Mr. Baker noted the slowing pace of job loss but added, "It is important to recognize that this rate of job loss, especially when adding the upward revisions, would be considered disastrous at any other time."

The household data, which comes from the Current Population Survey, determined the unemployment rate for adult men last month continued to rise faster than that for adult women. Men reached 10.1 percent unemployment, a level not seen since December 1982, while women saw an unemployment rate of 7.6 percent, about the level seen in September 1983.

Heidi Shierholz, an economist with the Economic Policy Institute, noted the numbers showed that unemployed workers in the current recession have been out of work, on average, longer than during any previous recession. The data showed 5 million workers have been unemployed for more than six months.

Ms. Shierholz said 3.2 percent of all workers, which translates to a third of all unemployed workers, have been out of work for more than half a year.

Unemployment for teenagers hit 25.5 percent for August, the highest rate since the bureau started keeping track in 1948.

Unemployment has hit the population of black teenagers especially hard: More than a third of black teens, 34.7 percent, were unemployed last month, though that number was down by 2 percentage points from last month's rate of 35.7 percent and more than five percentage points from the recession's highest rate in May of 39.4 percent.

Economists at the Employment Policies Institute noted that the rising unemployment for teenagers, up by 1.7 percent, coincided with the increase in the federal minimum wage to $7.25 an hour from the previous level of $6.55. In Pennsylvania, however, minimum wage already was above the federal level so the lowest paid hourly workers only saw a 10-cent increase.

Kristin Lopez Eastlick, an analyst at the institute, called the rising teen unemployment an "unintended consequence of the federal minimum wage hike."

Black and Hispanic workers were more likely to be unemployed than whites, with the respective rates at 8.9 percent for whites, 15.1 percent for blacks and 13 percent for Hispanics.




Ann Belser can be reached at abelser@post-gazette.com or 412-263-1699.


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