NC jobless rate rises in May as 19,000 enter job market

jmurawski@newsobserver.comJune 20, 2014 

Maelene Hayes, left, a recruiter for Monarch, talks to job-seeker Donna Luczka, 56, with her husband, Paul, 55, who was there for support. The couple, from Clayton, attended the annual job fair at Johnston Community College on May 13.

PAULA SELIGSON — pseligson@newsobserver.com

North Carolina’s jobless rate inched up to 6.4 percent in May as nearly 19,000 job seekers entered the job market in search of work.

The uptick in the state’s jobless rate, from 6.2 percent in April, is the first time in two years the monthly rate has not decreased or held steady. The state’s jobless rate was 8.3 percent one year ago.

The May surge of new job seekers suggests a confidence boost in employment potential, even though North Carolina’s labor pool remained smaller in May than it was a year earlier.

“At least in May the increase in the jobless rate was due to the right reasons,” Wells Fargo economist Mark Vitner said. “It seems to me that the improvement in North Carolina’s economy is beginning to entice folks back into the labor market, which will make it harder to drive down the unemployment rate.”

State unemployment data was released Friday by the Labor and Economic Analysis Division of the N.C. Department of Commerce.

North Carolina gained 5,700 jobs in May, for a revised total of 30,100 jobs added in the first five months of 2014. The biggest job gains were in leisure, hospitality, trade, transportation, utilities, education and health services.

North Carolina’s biggest job losses in May were in professional and business services, as well as manufacturing.

East Carolina University economist James Kleckley said the state would have to create more than 6,000 jobs a month to approach the 77,300 jobs it created last year.

A strong economic recovery would require creating between 8,000 and 10,000 jobs a month, Vitner said. At its economic peak, North Carolina was creating more than 100,000 jobs a year.

“Quite frankly, we’re not creating the jobs fast enough,” Kleckley said. “It’s not growing fast enough to get those unemployment numbers down to where we’d like to see them.”

Economists said 19,000 people flooding the labor pool in one month is unusually high, noting that month-to-month economic reports can fluctuate and that the beginning of summer is a time when students get out of school or graduate and begin sending out résumés.

Allan Freyer, a public policy analyst with the N.C. Budget and Tax Center in Raleigh, noted that North Carolina will reach a turning point when it replaces the 328,000 jobs that were erased from the state’s economy by the recession six years ago. He expects that to happen in less than a year.

However, the replacement jobs are not always as good as the jobs that vanished. U.S. Bureau of Labor Statistics data show that nearly half the jobs North Carolina is adding are low-wage positions in retail, administration, waste management and food services, Freyer said.

Kleckley noted that North Carolina’s economic potential is constrained by the recovery of the national economy.

The national jobless average in May was 6.3 percent.

Murawski: 919-829-8932

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