Jobless Rate Dips in Washington State, but it Inches Up in Seattle

The Seattle Times

Sarah Anne Wright

January 21, 2004

Jan. 21--For some of the nearly 214,000 Washington residents who are out of work, the unemployment numbers must seem puzzling.

The state's December jobless rate fell for the third month in a row, to 6.8 percent, down from a revised 6.9 percent in November, according to figures released yesterday.

Nationally, the unemployment rate dropped to 5.7 percent for December, from 5.9 percent in November.

However, the Seattle-area jobless rate worsened slightly, up to 6.6 percent last month from 6.5 percent in November.

Roberta Pauer, Seattle economist with the state Employment Security Department, blamed the Puget Sound area's lackluster unemployment rate on jobs lost in the technology crash and Boeing's corporate contraction.

"The ripple effect on the rest of the economy is dragging our economy from any kind of recovery," said Pauer.

The brightening jobless figures statewide have been attributed to the fact some discouraged unemployed people have simply quit looking for work.

"When the labor market is bad, people give up," said Pauer.

Washington's unemployment rate has hovered roughly a percentage point above the national rate.

But the state's improving jobless-rate trend knocked Washington's unemployed out of programs that paid extended unemployment benefits to those living in hard-hit regions.

State Employment Security officials estimated last month that up 7,500 people would lose extended benefits. Each month, about 8,600 people exhaust standard unemployment benefits.

As for new jobs, the state didn't see many.

Washington lost 9,300 jobs last month, including 4,800 in government and seasonal layoffs in construction and manufacturing.

Employment services, including staffing and temporary agencies, lost some jobs after showing signs of improvement recently.

Earlier, it had seemed gains in this industry were a precursor to the creation of permanent jobs in the near future.

For the year, just 3,100 new jobs -- a gain of about 0.1 percent -- were created statewide out of a total of 2,670,000 jobs.

In the Seattle-Bellevue-Everett area, the job total is down 11,800 for the year (December 2002 to December 2003).

That's out of a total of 1,350,000 positions, according to a recent state count.

Oregon's December unemployment rate also fell, to 7.2 percent from 7.3 percent in November. Washington's neighbor added 5,200 jobs last month to its total of 1.5 million jobs.

Some experts said there was less need to create jobs, thanks to gains in efficiency from technology and employees who are working longer hours.

"I'm cautious and doubtful that we are going to see significant job creation," said John Challenger, CEO of the Chicago-based outplacement firm Challenger, Gray & Christmas.

Increased productivity, he said, was limiting the number of new hires companies needed.

"Job creation has been Napsterized. The technology has changed the paradigm," Challenger said. "Business owners are saying, 'There's no reason to add more people.' "

Some don't view the declining jobless rate and lack of new jobs as a sign of an improving economy.

"It's odd to me to be trumpeting economic growth when the growth is not resulting in jobs for workers," said John Burbank, executive director of the Seattle-based Economic Opportunity Institute, a nonprofit group that proposed an espresso tax to raise money for early-childhood education.

Across the state, counties with the highest unemployment rates were Ferry, 15.1 percent; Klickitat, 14.8 percent; and Adams, 12.8 percent. None has a labor force of more than 10,000 workers.

Economists expect that once King County recovers, the rest of the state will follow.

"King County lost the majority of the jobs in the recession," said Kirsta Glenn, chief economist with the state Employment Security Department. "So when we see a turnaround, that's where we'll see it."

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(c) 2004, The Seattle Times. Distributed by Knight Ridder/Tribune Business News