The state unemployment rate rose for the fourth straight month in September as job declines across a swath of industries took a toll on North Carolina's sputtering economy.
The state unemployment rate rose to 10.5 percent last month, up one-tenth of a percent from August and up five-tenths of a percent from a year ago, according to seasonally adjusted data released Friday by the state Employment Security Commission.
Just six states and the District of Columbia have higher unemployment rates than North Carolina. The national rate in September stood at 9.1 percent.
"The bottom line is, the labor market remains in bad shape," said John Quinterno of South by North Strategies, a Chapel Hill firm specializing in economic and social policy. "We're not really growing jobs."
He said by several measurements September was the worst month this year for the state's labor market.
The net job loss in September, 22,200, was the highest recorded so far this year, and those losses wiped out more than three-fourths of the gains recorded in 2011.
In recent months, companies across a range of industries have announced job cuts. They include contract manufacturer Flextronics, which is cutting 83 jobs at three North Carolina locations, and commercial printer Henry Wurst, which is closing its Apex plant and laying off 48 full-time and 20 part-time workers.
Major cuts also are expected once Progress Energy and Duke Energy complete their merger. Progress intends to eliminate up to 1,000 jobs at its downtown Raleigh headquarters.
The latest unemployment numbers were so bad that Mark Vitner, senior economist for Wells Fargo Securities in Charlotte, questioned whether they're providing an accurate picture of the state's economy.
"As bad as conditions are out there, I think that the employment numbers may be exaggerating the weakness somewhat," he said. "Things are certainly not rosy, but they may be a little bit better than what those numbers suggest."
More than half the jobs lost - 13,700 - were in the government sector.
Government job numbers have fluctuated wildly in recent months, falling 11,800 in July and rising by more than any other sector in August as teachers returned to work after the summer vacation.
The swings have led state Republicans and Democrats to offer up dueling narratives as to what's happening in the labor market. Democrats blame the budget cuts implemented by the Republican-controlled legislature, while the GOP counters that the Democrats' policies already have proved to be inadequate and that their efforts to boost the economy ultimately will succeed.
ESC officials on Friday cautioned against reading too much into the changes in the government jobs data. Even though the numbers are seasonally adjusted, the agency said, the ups and downs of jobs in the education sector aren't fully captured by such adjustments.
The agency advised focusing on year-over-year changes instead of month-to-month fluctuations. But those numbers told a similar tale: The number of government jobs fell by 18,700 over the last 12 months, more than any other sector.
"Year over year, you really do see state and local government employment in North Carolina has declined and is weighing against the economy," Quinterno said.
N.C. State University economist Michael Walden said he's still not expecting a double-dip recession despite the disheartening numbers. Instead, he sees "sluggish, modest growth" going forward that would incrementally lower the state's unemployment rate to between 9.5 percent and 9.7 percent a year from now.
The state unemployment peaked at 11.4 percent in February 2010, the height of the recession. The rate was 4.5 percent in March 2007, a few months before the recession largely squelched new job creation.
