Oregon hits record unemployment. What is behind the data.

Oregon’s Employment Situation: May 2009
By Oregon Employment Department,

Oregon’s seasonally adjusted unemployment rate rose to 12.4 percent in May compared with 11.8 percent (as revised) in April. The 12.4 percent reading was the highest on record since the current series began in 1976, topping the previous high mark of 12.1 percent set in November 1982.  The state’s unemployment rate remains more than twice as high as its year-ago level of 5.7 percent in May 2008. The U.S. seasonally adjusted unemployment rate rose to 9.4 percent in May, from 8.9 percent in April.

In May, Oregon’s seasonally adjusted nonfarm payroll employment declined by 100 jobs, following a drop of 8,100 (as revised) in April. The May employment figures were by far the smallest job loss of any month over the past 10 months.

Industry Payroll Employment (Establishment Survey Data)
In May, most of the major industries followed their normal seasonal patterns. This was in contrast with the prior eight months, when many industries cut employment sharply below normal seasonal expectations. In May, all of the major industries except two saw their employment change by within 600 jobs of their normal seasonal movement.
Manufacturing was one exception, where employment continued to fall below normal seasonal patterns. It cut 1,300 jobs on a seasonally adjusted basis. Leisure and hospitality was the other exception, as it grew by 1,600 jobs on a seasonally adjusted basis.

Manufacturing cut 700 jobs during a month where a gain of 600 is the normal seasonal movement. This major driver of the state’s economy has been shedding jobs for three years. Losses had been particularly severe during the fourth quarter of 2008 and the first quarter of this year. The cuts in May, while substantial, were at a slower rate than during the past several months.

Durable goods manufacturing again accounted for all of the manufacturing declines, as it cut 1,200 jobs in May and is down 26,700 from its year-ago figure. At 118,000 jobs, durable goods is now down 38,900 jobs or nearly 25 percent from its recent peak of 156,900 in August 2006.

Nondurable goods has been holding up much better, as it added 500 jobs in May and is only down 1,500 since May 2008.

Primary metals manufacturing cut 600 jobs as it continued to plunge. The industry employed 7,700 in May, near its lowest level of the past 20 years. Similarly, machinery cut another 200 in May, to reach 9,100 jobs, down sharply from 12,000 a year prior. Paper manufacturing continued to be the weak performer in nondurable goods. It cut 100 jobs to reach 5,100, which was down sharply from its year-ago figure of 6,000 jobs.

Professional and business services slowed its rate of descent in May, with a loss of only 100 jobs. However, this came at a time of year when a gain of 500 is the normal seasonal change. The industry had been declining rapidly since the summer of 2008. Since May 2008, it is down 17,200 jobs or 8.7 percent, making it the most rapidly falling of the service-providing industry sectors.

Rare job gains were posted in employment services (+900 jobs) and services to buildings and dwellings (+300 jobs). These gains helped boost administrative and waste services by 2,100 in May.

Professional and technical services, which makes up about 40 percent of the larger category called “professional and business services”, had been holding up relatively well over the past two years. However, it has shown some weakness over the past three months, shedding 2,300 jobs on a seasonally adjusted basis over that period.

Financial activities continued on its downward slide of the past two years, slipping 400 jobs when a gain of 100 is the normal seasonal expectation. The industry has cut 6,900 jobs, or 6.7 percent of its workforce since May 2008. Both component industries were down slightly in May: finance and insurance ( 100 jobs) and real estate and rental and leasing (-300).

Leisure and hospitality bounced back somewhat in May following a steep employment drop between October and March. It added 4,900 jobs for the month when a gain of only 3,300 is the normal seasonal movement. These added jobs erased about a fifth of the seasonally adjusted job losses experienced in the industry since October.

All of the gains in May were seen in accommodation and food services. Accommodation added 800, while food services and drinking places added 4,900. Despite these one-month additions, all published industries within accommodation and food services are still down substantially since May 2008.

Construction posted a gain of 1,700 jobs in May, when a gain of only 1,100 is the normal seasonal movement. This encouraging news follows several months of steep seasonally adjusted job losses. Seasonally adjusted employment in construction was 79,500 in May, which was above the April reading, but still below the March figure of 80,900.

Each of the three major components of construction added jobs in May. Heavy and civil engineering construction added 900, construction of buildings added 300, and specialty trade contractors added 500.

Trade, transportation, and utilities added 1,900 jobs at a time of year when a gain of 1,300 would be normal. This was the first seasonally adjusted job gain for the industry in 16 months. Wholesale trade bounced back slightly with a gain of 300. Transportation, warehousing and utilities also rebounded somewhat, with a gain of 600 jobs. Despite the one-month gains, all industries in the larger sector of trade, transportation, and utilities are down substantially over the past year.

Unemployment (Household Survey Data)
In May, Oregon’s seasonally adjusted unemployment rate rose to 12.4 percent from a revised 11.8 percent in April.

While the May unemployment rate is at a historically high level, the increase in Oregon’s unemployment rate has moderated over the last two months. Between March and May, the rate rose from 11.9 percent to 12.4 percent. This is an increase of 0.5 percentage point over a two month period. This moderation in the rise of the unemployment rate followed a trend of very rapid monthly increases between October 2008 (when the rate was 7.2 percent) and March 2009.

During this five-month period, the rate rose by an average of nearly a full percentage point per month.

In May, 240,615 Oregonians were unemployed. In May 2008, 103,441 Oregonians were unemployed.

The Oregon Employment Department plans to release statewide unemployment rate and employment survey data for June 2009 on Monday, July 13, 2009.

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For the complete version of the news release, including tables and graphs, visit: www.QualityInfo.org/pressrelease.
For help finding jobs and training resources, visit one of the state’s WorkSource Oregon Centers or go to: www.WorkSourceOregon.org.
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