If the national economy is in danger of a “double-dip” recession, then the unemployment numbers in places like Washington state, where the economy is comparatively better off, reflect the expectation that things aren't getting better.
Figures released by the Washington State Employment Security Department today (July 15) tell the story of an economy that is mixed at best and faltering at worst. And they tell a story that has been blazoned across numerous publications, about the pressures on government as revenues fall.
Washington shed 3,500 jobs between May and June, driven by a loss of 8,500 government jobs, about half of those census workers. The government sector is expected to remain weak as the state, counties, cities, and towns all cope with sharp reductions in revenues and growing budget shortfalls. About 7,000 census workers remain on payrolls.
The private sector added 4,500 jobs, with eight sectors expanding, led by 1,300 new jobs in education and health services and 1,000 in construction. So far in 2010, Washington has added more than 20,000 private-sector jobs. But employment still remains about 80,000 jobs below its peak, and more than 315,000 people remain unemployed in the state.
“We are getting mixed signals,” said Dave Wallace, Employment Security’s chief economist. “There is not a clear picture of growth.” Wallace also said that he expects a return to peak employment levels to take a while, possibly as long as five years.
The state’s seasonally adjusted unemployment rate fell to 8.9 percent from May’s upwardly revised level of 9.2 percent. That compares with a national rate of 9.5 percent. The national rate also dropped slightly in June, from 9.7 percent.
The decline in the unemployment rate in June was the third successive month of decline. In the Seattle-Bellevue-Everett area the unemployment rate dropped slightly to 8.3 percent from 8.4 percent in May. The number of unemployed also dropped slightly to 123,800 from 125,900 in May. But another sign of the weak labor market is the fact that unemployment rose in Snohomish County to 9.6 percent from 9.2 percent in May. The Tacoma/Pierce County rate dropped from 9.7 percent in May to 9 percent in June.
Pockets of high unemployment remain in the state, mostly in two corners. In the northeast, Ferry, Stevens and Pend Oreille counties all have double-digit unemployment rates. In the southwest, a cluster of seven counties have double-digit rates led by 12.4 percent in Clark County.
Ferry County had the highest rate at 12.6 percent while San Juan County had the lowest at 5.4 percent.
Another troubling part of the report was a decline in the labor force. It is hard to decipher exactly where the decline was centered, but Wallace said it likely reflects the number of discouraged workers, people who have given up trying to find work. Nationally there were 1.2 million discouraged workers in the country, according to the Bureau of Labor Statistics, up by 414,000 from a year earlier.
There are increasing expectations that the economy will not grow quite as fast as once hoped, though there are no official projections for a double dip. The Federal Reserve recently lowered its forecast for gross domestic product to a range of 3 percent to 3.5 percent this year, down from 3.2 percent to 3.7 percent previously.
The minutes from the Fed's April meeting, released earlier this week, show the Fed concerned about the economy but still expecting it to grow. The Fed said it will “maintain the target range for the federal funds rate at 0 to 1/4 percent and continues to anticipate that economic conditions, including low rates of resource utilization, subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels of the federal funds rate for an extended period.”
Boeing reported some good news for the region. Its 2010 long-range forecast anticipates delivery of 30,900 new airplanes over the next 20 years, valued at $3.6 trillion. Boeing said the twin-aisle market is the fastest growing segment of the market, accounting for 23 percent of the aircraft and 45 percent of the anticipated revenue. Boeing did not break out its share of the anticipated market against its competitors.
"The world market is doing much better than last year, but there are still challenges," Randy Tinseth, vice president of marketing for Boeing Commercial Airplanes, said in a statement. "Looking at 2010, we see a world economy that continues to recover. We expect the world economy to grow above the long-term trend this year. As a result, both passenger and cargo travel will grow this year. Airline revenue and yields are up, but fuel prices remain volatile."
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