EagleTribune.com, North Andover, MA

December 20, 2013

Mass. unemployment rate dips to 7.1 percent

But Bay State posts higher rate than nation (7.0 percent) for first time since 2007


The Eagle-Tribune

---- — BOSTON (AP) — The unemployment rate in Massachusetts dipped slightly in November but not enough for the state to avoid posting a higher jobless rate than the U.S. as a whole for the first month in more than six years, officials said yesterday.

The state Office of Labor and Workforce Development said the November rate stood at 7.1 percent, down from 7.2 percent in October. The national jobless rate, announced earlier, dipped to a five-year low of 7 percent last month.

The last time Massachusetts posted a monthly unemployment rate higher than the nation’s was in May 2007, prior to the Great Recession, when the U.S. was at 4.4 percent and the Bay State at 4.5 percent.

Falling behind the nationwide drop in the unemployment rate is an indication to some that the state’s approach toward taxation and business regulation has hampered business.

“We haven’t focused on our economy the way we should,” House Minority Leader Brad Jones , R-North Reading said. “The cost of doing business here on too many fronts is too expensive.”

Jones said state leaders have shown “hostility toward business,” citing Gov. Deval Patrick’s proposed $2 billion tax increase, the more modest tax package that passed this summer, and the Senate’s passage of a minimum wage increase without concurrent reforms to unemployment insurance.

But, state officials stressed the positive elements of the latest jobs report, which included preliminary estimates from the federal Bureau of Labor Statistics that Massachusetts gained 6,500 jobs in November, along with revised estimates showing an increase of 9,400 jobs in the month of October.

The state picked up nearly 54,000 private sector jobs over the past 12 months, even as the jobless rate rose by 0.4 percent over the same period, the report said.

“This was a pleasant surprise,” said Robert Nakosteen, a UMass Amherst economics professor and executive editor at Mass Benchmarks, who said the preliminary estimate was a “moderately strong jobs report.”

Nakosteen said he was particularly heartened by the growth of professional, scientific and business services, which he said were most at risk by recent federal budget cuts. He said he had hoped for a continuation of growth in the construction sector, which was relatively flat.

“I focus more on the jobs numbers than the unemployment rate,” said Nakosteen. He said, “I’m not really all that concerned that it’s now above the national rate.”

About 58,000 people in Massachusetts are scheduled to lose their federal unemployment benefits on Dec. 28 unless Congress extends the program, which costs roughly $25 billion per year. There were 245,700 unemployed residents in Massachusetts in November.

Joanne Goldstein, state Secretary of Labor and Workforce Development, said she was not discouraged to see the jobless rate creep above the U.S. average, noting that the state had consistently outpaced the nation during the economic recovery.

“Massachusetts recovered earlier and stronger than the nation,” said Goldstein. “I’m very pleased that the nation is catching up with us.”

The state’s workforce has grown over the past year, Goldstein added, a factor that could help explain why the unemployment rate has trended up in recent months as more people feel confident about entering the labor force.

“There are no barriers that we see that will impede the progress that we are making,” she said, while cautioning that any number of unforeseen global events could influence the state’s economy.

The November report showed the largest gain in jobs — about 2,800 — in the professional, scientific and business services sector. The manufacturing sector picked up 2,100 jobs last month, but has still lost a net 1,000 jobs over the past 12 months.