Friday, June 27, 2008

Jobless rate soars in region

Spike from April to May puzzles MTSU economist By G. CHAMBERS WILLIAMS III • Staff Writer(Tennessean) • June 27, 2008 Davidson County's unemployment rate jumped nearly a full percentage point from April to May, to 5 percent from 4.1 percent, and similar increases were recorded in much of Middle Tennessee, according to figures released Thursday by the state Department of Labor and Workforce Development. The numbers are the latest sign that a tougher economy is taking a toll on the area's work force. About 2,800 more people were estimated to be out of jobs in May in Davidson County than a month earlier. "The increase is so large that we have to wait and see if this is an aberration," economist David Penn of Middle Tennessee State University said. "It is inconsistent with the payroll numbers. We're seeing slow growth here, but no huge drop-off as suggested by these spiking unemployment rates." The broader Nashville-Murfreesboro jobless rate for May was 1.6 percentage points higher than in May 2007, officials said, reaching 5.1 percent. That was up 0.8 percentage points from April to May, the labor department said. Penn said the rate increases were "puzzling." When a manufacturing plant closes, the jobless rate in the area of the plant would spike but there would not be a widespread increase like the ones seen in the past month, he said. "The only segment that has shown significant losses is manufacturing, but that has been going on for quite a while," Penn said. The state labor department said 94 of 95 counties showed an increase in unemployment in May compared with a month earlier. The only exception was Trousdale County, where the rate dropped slightly to 7.6 percent. Tennessee's statewide jobless rate for May, released last week, was 6.4 percent, up 1.7 percentage points from a year earlier. The U.S. unemployment rate was 5.5 percent in May. Williamson County had the lowest unemployment rate in the state last month at 4.2 percent, up 0.6 percentage points over the past year. Williamson was helped by the restart of the General Motors auto plant in Spring Hill, which is gearing up to make a new Chevrolet crossover utility vehicle. About 2,500 laid-off workers have been recalled there recently. Maury County got a big boost from the GM assembly plant as well. The GM facility is actually in Maury County, but it's close to the Williamson County line. Although Maury County's jobless rate climbed 0.4 percentage points in May from April, to 7.3 percent, the numbers were nearly a full point better than in May 2007 just after the GM workers had been laid off. Maury's unemployment rate at that time was 8.2 percent. Other job losses continue to occur in financial services, as well as the restaurant and travel industries, Penn said. He blamed rising gasoline prices for much of the restaurants' woes. "People are eating out less, and that means we're going to have fewer restaurants," he said.

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