D.C. area unemployment up 0.3% in May as yearly job growth appears to slow

June 29, 2011

The unemployment rate in the Washington region rose three-tenths of a percentage point in May, to 5.7 percent, according to a Labor Department report released Wednesday.

Government data showed a significant drop in the pace of job creation that had been taking place in the region during the past year. Analysts said the reduction in jobs largely reflects the loss of temporary employees who were in place a year ago to work on the U.S. Census and perhaps early signs of budget cuts expected at the federal level.

In May, the region’s not-seasonally adjusted unemployment rate stood at 5.7 percent, up from the April rate of 5.4 percent. The May 2010 to May 2011 comparison, which more accurately reflects fluctuating factors such as seasonal work that occurs in certain months, shows that the area’s jobless rate fell four-tenths of a percentage point — to 5.7 percent from 6.1 percent.

More telling, though, according to analysts, is the size of the May-to-May net job gain: 2,100. That compares with 20,400 in the 12-month period ending in April; 48,300 in the 12-month period ending in March; and 72,000 in the 12-month period ending in February. The federal government, whose unabated hiring bolstered the area’s economy during the economic downturn, posted a net decline of 5,500 jobs from May to May.

Analysts attribute much of that to the loss of temporary census workers who were in place a year ago. Still, some expressed concern about the results, saying they wanted to examine the data over the next few months to see whether an anticipated slowdown in government staffing from the as-yet unresolved budget talks is beginning to materialize.


“It was the federal government that was the strength of the region during the recession, but now, as we deal with the deficit, it’s become the weak point of the local economy,” said Sara Kline, associate economist at Moody’s Analytics.

The region also recorded a drop in another perennial gainer: The education and health sector lost a net of 500 jobs. Construction continued declining, hemorrhaging a net of 5,300 jobs. Information technology declined by a net 700 jobs. Manufacturing was down a net 2,600 jobs. Sectors that showed net gains included leisure and hospitality, up 2,800 jobs; retail, up 2,700; financial activities, up 1,600; and professional and business services, up 534.

The region’s non-seasonally adjusted May unemployment rate was well below the national rate of 8.7 percent, down from 9.3 percent the year before.

The unemployment rate dropped in 274 of the 372 metropolitan regions across the country; it rose in 85 and remained steady in 13.

Yuma, Ariz., had the nation’s highest unemployment rate, at 27.9 percent. Bismarck, N.D., had the lowest, with 3 percent.

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