Unemployment in the Washington region rose to 6 percent in August from 5.9 percent the month before, according to a Labor Department report released Wednesday, putting the brakes on a recovery that had spurred widespread hiring across sectors this year.
The region gained a net of 100 jobs from August 2010 to August 2011. Although modest, it’s a major improvement from the net loss of 11,100 jobs from July to July. Still, during the 12-month period ending in August, the region dropped 2,600 jobs in its traditionally most reliable sector: the federal government.
With widespread federal budget cuts looming, “clearly, this is the calm before the storm,” said John Gage, president of the 270,000-member American Federation of Government Employees.
“I think the [Washington region] is going to be hit harder than the rest of the country,” he said. “A lot of Washington is made up of agency headquarters with staff and support jobs. [The agencies] will be focused on cutting those jobs rather than the operations around the country.”
John M. Palguta, vice president for policy at the Partnership for Public Service, a nonprofit group that helps recruit for federal agencies, estimated that overall government hiring will decline to 102,500 in fiscal 2012, from an estimated 117,000 in fiscal 2011 and 138,000 in fiscal 2010.
“In the D.C. metro area, we’re going to see a loss of 2,200 to 3,000 jobs in fiscal 2012,” Palguta said. “It’s reasonable to conclude that it will be higher in fiscal 2013.”
As part of a new experiment to improve data reporting, the Labor Department has begun providing a seasonally adjusted jobless rate. The agency’s not-seasonally adjusted rate shows that unemployment remained steady at 6.1 percent from August to August. In the previous report, the rate dropped to 6.1 percent in July, from 6.3 percent the year before.
The agency does not provide a seasonal adjustment for its employment report, so only year-to-year comparisons are available for job gains and losses.
Construction continued struggling, losing a net of 6,200 jobs from August to August. Other sectors that declined were information, which includes media and technology companies, down 3,100 jobs; manufacturing, down 2,900; and leisure and hospitality, down 400.
But not all was dismal. The private sector gained a net of 400 jobs in the 12-month period ending in August. Industries that grew included professional and business services, up 6,900 jobs; education and health, up 6,200; financial activities, up 3,300; and retail, up 800.
“So far in 2011, we have added 1,800 new jobs in the communities in which we operate. By the end of the year, we expect that total to reach over 3,600 new jobs,” John G. Finneran, general counsel and corporate secretary of McLean-based Capital One, said in testimony last week before the Federal Reserve in Chicago over its plans to acquire ING Direct.
A spokeswoman said that Capital One, which last year completed a takeover of Chevy Chase Bank, plans to continue to accelerate hiring in the Washington area in 2012.
The nation’s unemployment rate in August was 9.1, well above the region’s jobless level. The not-seasonally adjusted jobless rate fell in 262 of 372 metropolitan regions across the nation. It rose in 84 and remained steady in 26.
El Centro, Calif., had the highest jobless rate among the 49 largest metropolitan areas: 32.4 percent. Bismarck, N.D., had the lowest: 3 percent.