November 26, 2024
Business

Employment rate masks difficult state job market

BANGOR – Maine’s unemployment rate for November reached 4.3 percent, a number that hasn’t been seen since late last year, but which is still well below the national rate of 6 percent.

One labor market expert, however, said the state’s consistently low unemployment rate, in comparison to the national number, actually is a happy-face mask that is hiding a dismal employment picture. And, he said, it shouldn’t be viewed as an indication that just about all Mainers who want to work are working and earning a comfortable wage.

John Hanson, director of the Bureau of Labor Education at the University of Maine, in a recent interview, called the rate “very deceptive,” particularly since pink slips have been plentiful in the last year.

“We really don’t have a handle on it,” said Hanson about the condition of the state’s working environment and how it is reflected in the unemployment rate. “It would appear [the rate’s] higher than public policy administrators want to acknowledge.”

He said the unemployment rate doesn’t accurately include those who have become discouraged about their job prospects and have quit looking for work altogether. And, starting next month, it may not accurately include the nearly 2,000 people whose unemployment benefits run out on Dec. 28 and won’t be extended unless Congress takes action in January.

According to the Maine Department of Labor, the seasonally adjusted unemployment rate of 4.3 percent for November matched the rate experienced in each of the last four months of 2001, and it remains well below the national rate of 6 percent, the highest that number has been since 1994.

State labor officials, in a statement released Tuesday, said the creation of new nonfarm wage and salary jobs has been minimal at best during the last couple of months. There are about 610,800 nonfarm and salary jobs statewide.

Throughout the year, about 2,100 new jobs have been created in service industries, government, retail trades and construction. But more jobs were cut – about 4,500 of them – in manufacturing.

Besides not capturing discouraged individuals, Hanson said the state’s count of the number of active jobs does not show accurately how many of them are filled by people who are underemployed – working fewer hours and earning less than they were before being laid off from a previous job.

“People are taking jobs at less than 40 hours a week and at pay less than the wages they were getting,” Hanson said. “People are appreciative of having any job these days.”

Hanson said he estimates that “of all the people working, 25 percent are in part-time jobs and would like to be in full-time jobs.”

According to the state Labor Department’s Division of Labor Market Information Services, 131,000 people had part-time jobs in 2000, the latest figures that are available. About 534,000 people were considered full-time employees. But classified as full-time workers are people who are employed at two or more part-time jobs who put in a total of 35 hours or more a week, said division analyst Roger Carpenter.

Carpenter said he doesn’t believe the state is missing a tremendous number of unemployed people when it calculates the unemployment rate. He said people who collect unemployment benefits represent about one-third of the state’s unemployment rate. Also, the Labor Department conducts a monthly survey of some people who have collected unemployment to check out their job status, and uses the survey results to try to determine how many people statewide are able to work but not looking for a job.

The state doesn’t keep a record of the number of discouraged individuals, but passes on figures to the U.S. Department of Labor for its national calculation, Carpenter said. Statewide, however, the number of discouraged individuals is “minuscule,” he said.

In November, about 29,500 people in Maine were unemployed. According to one state labor official, 4,946 people exhausted their unemployment benefits by the end of October, “and we don’t know if they found a job.” The state estimates that another 1,400 will use up their benefits between November and December, and as of Nov. 30, 1,748 people have filed for extensions and could lose their benefits after the extension program expires on Dec. 28.

In Maine, the not seasonally adjusted unemployment rate for November was 4.3 percent, up from 3.7 percent in October. The unadjusted national rate was 5.7 percent for November, up from 5.3 percent for October.

Cumberland Country recorded the lowest not seasonally adjusted unemployment rate at 2.6 percent, while the highest was 8.5 percent in Somerset County. The not seasonally adjusted rate was 4.5 percent in Penobscot County, 8.3 percent in Washington County, 4.6 percent in Aroostook County and 5.0 in Hancock County.


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