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Jobless rate falls, masking negative statistics
Drops in January from 10% to 9.7%, lowest since August
Saturday, February 06, 2010

The surprising drop in the national unemployment rate to 9.7 percent in January, the lowest level since August, masked some disturbing statistics.

While the unemployment rate for white people declined from 9 percent to 8.7 percent, the rate for black people grew from 16.2 percent to 16.5 percent, the Bureau of Labor Statistics reported Friday.

And while the number of jobs lost has been declining from more than 700,000 a month in the first quarter of 2009 (according to revisions posted yesterday) to 20,000 last month, there is a record 6.3 million people who have been out of work for six months or more, which is 41.2 percent of all people who are unemployed.

Christine Riordan, a policy analyst for the National Employment Law Project, noted that the previous high for the number of people unemployed more than 6 months as a percentage of all people unemployed was 26 percent in 1983 when it took an average of 21.2 weeks to find a new job.

Now it is taking people an average of 30.2 weeks to find a job.

Many long-term unemployed are depending on the U.S. Senate to reauthorize the extension of unemployment benefits. If the Senate does not act before the extension expires in March, 1.2 million people -- 62,000 in Pennsylvania -- will lose their unemployment benefits next month and 5 million -- 277,000 Pennsylvanians -- will lose their benefits by June.

While the unemployment rate for black teenagers improved 4.6 percentage points, it remained at a shocking 43.8 percent in January. The jobless rate for white teenagers was 23.5 percent in January.

In keeping with the rest of the Great Recession, the unemployment rate for adult women (older than 20 years) was 7.9 percent in January, better than the rate for adult men, which was 10 percent unemployment. Industries in which women traditionally make up the work force continued to improve, leading white women to see a decrease in their levels of unemployment from 7.4 percent in December to 6.8 percent last month; white men were unemployed at a rate of 9.1 percent. The employment gain was not shared by black women for whom unemployment rose from 13.1 percent to 13.3 percent; black men were unemployed at a rate of 17.6 percent.

Unemployment in the Asian community was 8.4 percent overall, better than for whites (8.7 percent), blacks (16.5 percent) or Hispanics (12.6 percent).

There were glimmers of good news in Friday's report on payrolls.

The underemployment rate -- which counts the number of people unemployed, working part-time because they can't get full-time work and the number of people who have given up looking for work but would take a job if it were available -- fell to 16.5 percent in January from 17.3 percent in December.

Jobs manufacturing durable goods rose by 13,000, though construction lost 75,000 jobs. Retail trades added 42,100 jobs, including 14,300 in restaurants and bars and 13,300 in clothing stores.

Dean Baker, an economist with the Center for Economic Policy Research, said the increase in retail jobs may be an anomaly after a low level of hiring for the holiday season.

Temporary services, which is often seen as a harbinger of a recovery, added 52,000 jobs last month.

Though there has been hiring in some sectors, the decrease of 20,000 jobs overall in January means the nation has lost 8.4 million jobs since the recession started in December 2007.

Heidi Shierholz, an economist with the Economic Policy Institute, noted the nation has fewer jobs in the beginning of this decade than it did at the turn of the century, while the population has grown by 11 million people.

The stock market declined immediately on the news that the unemployment rate was more favorable than expected. The day ended essentially flat with the Dow Jones industrial average, Nasdaq and the Standard and Poor's 500 all gaining less than 1 percent.

Ann Belser: abelser@post-gazette.com or 412-263-1699.
Washington correspondent Daniel Malloy writes the "Pittsburgh On The Potomac" blog exclusively at PG+, a members-only web site of the Pittsburgh Post-Gazette. Our introduction to PG+ gives you all the details.
First published on February 6, 2010 at 12:00 am