Nov. jobless rate in Md. was highest in six years

January 05, 1991|By David Conn

Maryland's unemployment rate leaped nearly a full percentage point in November to the highest level in almost six years, the state reported yesterday in the clearest indication that Maryland is suffering from the effects of the nation's first recession in eight years.

The November jobless rate climbed to 5.3 percent from 4.5 percent, where it had remained for four months. It was the highest unemployment rate since January 1985 when unemployment reached 5.5 percent, said Pat Arnold, director of the Office of Labor Market Analysis and Information at the state Department of Economic and Employment Development.

The last time the unemployment rate rose as dramatically was in January 1982, when it jumped to 8.7 percent from 5.8 percent, Mr. Arnold said. Unemployment typically increases from December to January because of post-holiday season layoffs, he noted.

In Baltimore, the jobless rate rose to 8.2 percent from 7.5 percent in October. In November 1989, the city's unemployment level was 5.8 percent.

In the Baltimore metropolitan area, the unemployment rate rose to 5.6 percent in November from 4.9 percent in October, Mr. Arnold's office reported.

"After months of resistance to national trends, Maryland's labor force behavior in November has finally shown some vulnerability to the country's economic downturn," said J. Randall Evans, secretary of economic and employment development.

"Even so, Maryland's economy continues to outpace the national economy," Mr. Evans said.

That was about the only bright spot in the November report, which lags a month behind the national jobless report.

The story was the same for every county in Maryland. The smallest increases in unemployment were in the Washington area, where the rate rose three-tenths of a percentage point in Prince George's and Montgomery counties, to 4.4 percent and 3.1 percent, respectively. Montgomery's rate was the lowest in the state.

At the other end of the spectrum were Somerset and Worcester counties, each with 12.5 percent unemployment, up from October's 7.9 percent and 7.4 percent, respectively.

"In Somerset County, the seasonal downswing in agriculture, seafood and food-processing caused unemployment to rise," the department said, while Worcester County suffered because of layoffs in tourism-related industries.

As in late summer and autumn, total employment fell in November -- by 49,360 from 2.415 million. But unlike previous months, a 31,657 decrease in the size of the labor force wasn't enough to offset the drop in employment. As a result, total unemployment rose by 17,703 in November, to 131,567.

"In October, the decline in employment was practically matched with the decline in the labor force," Mr. Arnold said, but that situation was not repeated in November.

The higher jobless rate was even more alarming because November

traditionally marks the start of temporary holiday-season hiring. The lower employment figures could be a reflection of weaker-than-usual retail sales, Mr. Arnold said.

And continuing growth in the number of continuing unemployment claims points to an even higher jobless rate for December. But Mr. Arnold said those figures could be deceptive because a higher proportion of unemployed people tend to file for insurance benefits as the winter months proceed. He said it was too early to say what percentage of people out of work have been filing for unemployment benefits.

The majority of layoffs in November came from construction and manufacturing companies, according to the department. Industries that showed employment gains included trucking, health services, local government and most service industries, the department said.

Mr. Arnold said the higher jobless figures will not threaten the safety of Maryland's unemployment insurance trust fund, which is used to pay workers' jobless claims. That's because an automatic surtax will go into effect next year if the fund dips below a certain level, as it is expected to do.

Mr. Arnold also noted that the fund is "getting a lot of attention now" from state officials who plan to suggest reforms to the unemployment insurance taxation system in the coming legislative session.

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