Area Unemployment Rate Fell in August

Jobs Declined, Too, as Workforce Shrank

The unemployment rate in the Washington region fell for the second consecutive month, according to government data released Wednesday, a decline some analysts attributed not to an improving economy but to people who have given up looking for work and have dropped out of the labor pool.

In August, the Washington area's unemployment decreased to a not-seasonally-adjusted rate of 6.0 percent, down from 6.2 percent in July and 6.5 percent in June, according to the Bureau of Labor Statistics. While the region is gaining jobs in the federal government and in the contracting sector, it still is losing more in construction, retail and utilities. In August, the region's labor force decreased by 46,000, to 3.03 million, according to the Center for Regional Analysis at George Mason University, mainly because of students leaving their summer jobs and returning to school. That same month, the number of employed people in the region dropped by 37,000, to 2.85 million.

"The decline in unemployment is not shown in the data as these workers being re-employed," said Stephen S. Fuller, the center's director.

With one-third of its economy buttressed by the growing federal government and contracting industry, the region's level of joblessness is far below the national rate of 9.6 percent, the report said. In August, Bismarck, N.D., had the lowest nonfarm unemployment rate -- 3.3 percent -- of the 369 metropolitan areas the government surveys. At the same time, 129 metropolitan areas had rates of at least 10 percent, including El Centro, Calif., at 28.7 percent; Yuma, Ariz., 26.1 percent; and Detroit, 17 percent.

Even with relatively low unemployment, there still is great disparity in the Washington region. For instance, the August rate in the District was 11.2 percent, compared with 4.7 percent in Northern Virginia. The District's rate, which had not surpassed 11 percent since July 1983, is approaching its peak of 11.8 percent, reached in June of that year, according to government data.

"This high level of unemployment will be with us a while even after the recession is technically over," Joseph P. Walsh Jr., director of the District's Department of Employment Services, said in a recent interview. "We're in this for the long haul."

Experts blamed the city's high unemployment rate on a larger proportion of adults who are lacking higher education and are more likely to be working in vulnerable low-skill and low-paid jobs. The higher-paid, higher-skill jobs being created in the federal government and contracting sector, D.C. officials have said, are disproportionately going to suburban residents.

"The fact that we're getting close [to the 11.8 percent peak] is disturbing," said Benjamin Orr, research analyst at the Brookings Institution's Metropolitan Policy Program.

In Northern Virginia, from August 2008 to August 2009, the federal and local governments added about 8,200 jobs, and the leisure and hospitality sector grew by 5,100 jobs, said William F. Mezger, chief economist for the Virginia Employment Commission. But during that period, the area lost more jobs -- 15,100 -- in construction, retail, transportation and utilities.

"Northern Virginia is down 1 percent," he said.

Eric M. Seleznow, executive director of the Maryland Governor's Workforce Investment Board, said employment in the D.C. suburbs have remained steady because of high demand for new workers in the federal government and contracting, education, health and defense sectors. But, he said, it is too early to tell whether the declining jobless rate is the beginning of a trend.

"We've been seeing more people exhaust their benefits, looking for work for a while and then drop out of the [labor] pool," Seleznow said. "Whether there is a real turnaround or not, the next few months will tell."