New report shows signs of discouraged workers

By Ryan Wynne

Whatcom County’s unemployment rate in December 2010 stayed relatively flat compared with the previous month. At the same time, new Employment Security Department data reveal signs of discouraged job seekers and a decline in non-farm employment.

Month-over-month numbers for the local area show that the size of the labor force and the number of employed both declined by about 2,350, according to a report by Reinhold Groepler, labor economist with the Employment Security Department.

And that decline, combined with a flat unemployment rate, could be a bad sign.

If workers fell out of the category of employed workers, but didn’t show up in data as unemployed, which is people without jobs who are looking for work, then where did they go?

“What it means is people are just disappearing out of the labor force ― they are discouraged workers,” Groepler said.

There are a few other possibilities, too, he said. They could have become full-time students, moved away, or retired.

The county unemployment rate increased slightly to 8.1 percent (not seasonally adjusted) in December 2010 from an 8 percent reading in November 2010, which is a normal seasonal pattern.

Year over year, the unemployment rate was slightly lower ― it was 8.3 percent in December 2009. The year-over-year decrease is not a sign of real progress because of the increase in discouraged workers, the report said.

Another pattern is seasonal layoffs, which peak in December because of a slow down in retail activity, construction and hospitality, Groepler said. Last month, 2,478 initial unemployment claims were filed in the Whatcom County area. That’s nearly 485 more than were filed in November 2010, and is almost on par with initial claims the previous year.

Area job numbers tell a similar story. Between November and December, the area lost about 700 non-farm jobs ― 500 in the private sector and 200 in government.

“It was kind of nasty here,” Goepler said.

Year over year, December showed a loss of 1,500 jobs in the local area, 1,000 of which were in the private sector.

Statewide, Washington added an estimated 2,100 jobs in December, while the estimated unemployment rate increased slightly from 9.2 percent to 9.3 percent. For all of 2010, Washington added 11,800 private-sector jobs. Factoring in a substantial loss of government jobs, there was an estimated net gain of 8,000 jobs during the past 12 months.

Groepler’s industry overview

Health care employment on a statewide basis enjoyed a solid year-over-year gain. In Whatcom County, though, the residual services category, which includes health care, suffered a decline of  approximately 4 percent ― about 600 jobs.

There was a surge in retail sales in the county due to the impacts of a strengthening Canadian dollar and a switch to the Harmonized Sales Tax in British Columbia. But those sales haven’t translated into retail sector employment, which showed year-over-year growth of about 1 in December. The comparable statewide figure is up more than double that.

Construction-related employment in December dropped nearly 12 percent compared to the previous year — on a percentage basis, that’s the steepest drop of all sectors.

Manufacturing employment has been the bright spot in all Northwest Washington counties. In Whatcom County it increased by about 4 percent or 300 jobs over the course of the year. That is about four times the statewide growth rate. Still, with manufacturing being about a 10 percent share of employment in the county, other sectors will need to expand to help lower the unemployment rate.


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