Unemployment rate up slightly for Maine in July

BANGOR – The state’s unemployment rate for July was up slightly over the previous month, but job gains were recorded in three areas that have continually experienced growth in the last couple of years – education, health services, and leisure and hospitality services.

The seasonally adjusted unemployment rate was 4.2 percent, up from 4.1 percent in June, yet a full percentage point below the July 2003 rate of 5.1 percent.

The number of unemployed people dropped by 6,200 people in a year, according to the state Department of Labor. More than 1,400 jobs were created last month.

“We’ve had job gains since April,” said Dana Evans, an analyst with the labor department’s Labor Market Information Services. “[They’ve been] in service-based industries, but that’s been true for a few years.”

Most of the job gains are being experienced in southern and coastal Maine, and state officials say they are working on plans to grow jobs in areas north of Portland.

Christopher St. John, executive director of the liberal think tank Maine Center for Economic Policy, said he finds Maine’s unemployment rate “interesting.”

Historically, he said, Maine has been slower to recover jobs lost during a recession. That happened in the early 1990s, when the state was in one of its worst recessions ever. But coming out of the recession that started in March 2001, Maine has recouped jobs faster than most other states.

However, St. John said, the distribution of job gains has been uneven between southern and northern Maine.

“Maine has been a leader in the loss of manufacturing jobs,” St. John said. “Maine has been able to replace those jobs, but there’s two problems with that. One, they’re concentrated in retail and various services, and two, there are geographic or spatial disparities.”

Laura Fortman, commissioner of the Maine Department of Labor, said she agrees that job growth has been uneven. But, she said, that doesn’t mean efforts are not under way to add jobs in counties where little or no growth has been occurring.

“It took us a long time to get where we are, and it takes a long time to get out,” Fortman said.

She said “the way [the state] is approaching the [unemployment] numbers” is to promote governmental policies that eventually should encourage job growth.

Among the initiatives are Gov. John Baldacci’s Pine Tree Enterprise Zones, which give tax and other breaks to businesses that move to a more economically challenged part of the state or to existing businesses that add employees and increase sales. Also, the creation last year of a Cabinet-level position to coordinate economic and work force development policies with education strategies.

Fortman acknowledged that “it has been a reality that gains are in service-sector jobs” instead of manufacturing. But, she added, if Gov. Baldacci hadn’t worked to recover some of the paper company job losses experienced at the former Great Northern Paper Co. and the former Eastern Fine Paper Co., “that disparity would be even greater.”

Statewide, the Department of Labor tracks two unemployment rates. The seasonally adjusted rate is altered to take into account normal fluctuations in employment such as tourism-related jobs or schools being in or out of session. The seasonally adjusted rate is calculated only for the state and not for its counties or labor market areas, which are cities or communities.

Maine’s not-seasonally adjusted rate for July was 3.5 percent.

The counties with the highest seasonally adjusted unemployment rate were Somerset at 7.4 percent, Washington at 6.3 percent, Oxford at 5.5 percent, Aroostook and Franklin at 4.8 percent, Piscataquis at 4.5 percent and Penobscot at 4.2 percent.

Lincoln County had the lowest seasonally adjusted unemployment rate at 2 percent, with Knox County at 2.2 percent, Cumberland County at 2.3 percent and Hancock at 2.9 percent.

The community with the highest not-seasonally adjusted unemployment rate was Millinocket-East Millinocket, at 11.7 percent. A year ago, the towns that housed the former Great Northern Paper, had a rate of 31.1 percent.

Portland’s not-seasonally adjusted unemployment rate was 2.2 percent in July and Bangor’s was 2.8 percent.