Metro Washington unemployment holds steady despite job gains

By V. Dion Haynes
Washington Post Staff Writer
Wednesday, September 1, 2010; 2:06 PM

Unemployment in the Washington region remained steady at 6.3 percent from June to July, according to federal government data released Wednesday, despite significant job growth during the past year.

The Bureau of Labor Statistics' report shows a stabilization in the rate even as employment soared: The region experienced a net gain of 41,800 jobs from July 2009 to July 2010. That is up substantially from the 12-month period ending in June, when a net of 15,000 jobs were added.

Analysts say there are several reasons why the unemployment rate is not reflecting the job gains: A steady wave of openings in the federal government is being filled largely by people from outside the Washington area, rather than unemployed people in the region. And long-term unemployed people, who had dropped out of the labor force when they stopped looking for work, have resumed their searches and again are being counted among the jobless.

"We have replaced our losses, but not with the same jobs," said Stephen S. Fuller, director of the Center for Regional Analysis at George Mason University. "We have a stronger economy with more people working, but there are also more people looking for work."

The region had the lowest unemployment rate among large metropolitan areas around the country, according to the BLS. The rate stabilized after rising from a not-seasonally adjusted 6 percent in May - and having experienced numerous rises and dips over the past year. The BLS readjusted the June rate to 6.3 percent after initially reporting it as 6.4 percent in July.

"Part of the process of recovery is the unemployment rate wiggles around some and doesn't tell us anything until it starts to drop consistently - and I don't expect that to happen until next year," Fuller said.

Metropolitan Washington's employment gains represent a turnaround from last year when the region experienced a net loss of tens of thousands of jobs.

The sector that showed the strongest rebound was retail, which gained a net of 12,000 jobs over the year. During the peak of the recession last year, the sector was losing that same number of jobs.

Other sectors that gained jobs were the federal government (up 20,000); professional and business services (up 14,000); hospitality (up 12,000); and health and education services (up 4,000).

The sectors that lost jobs were local government (down 7,000); financial services (down 3,000); and manufacturing (down 3,000). Even with the losses, there were signs that those sectors are climbing out of the hole. For instance, construction was down 5,000; at its worst, it was down 19,000 last year.

The region's unemployment rate was slightly higher than a year ago, having risen to 6.3 percent from 6.2 percent. That is still well below the national unemployment rate in July, a not-seasonally adjusted 9.7 percent.

El Centro, Calif., had the highest unemployment rate in the nation - 30.3 percent. Bismarck, N.D., had the lowest rate, 3.1 percent.

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