Georgia’s jobless rate highest in 15 years

Georgia’s jobless rate climbed last month to 6.2 percent — its highest level in more than 15 years, according to the state Department of Labor.

The jump, from 5.6 percent in June and from 4.4 percent in July of last year, puts the state above the national rate of 5.7 percent.

Unfortunately, the news will probably get worse before getting better, said Don Sabbarese, director of the Econometric Center at Kennesaw State University.

“It is kind of nasty-looking right now,” he said. “It is really hard to find some positive stuff.”

Even exports — which have been a bright light — could suffer since growth of many European economies seems to be slowing, he said.

The last time the state’s jobless rate climbed this high was early 1993, when the labor market was recovering from recession. In the next few years, the economy picked up speed, hiring caught up and the state enjoyed a spectacular boom.

This time, prospects — at least in the short term — are more pessimistic since the economy has been burdened by some critical forces.

“Right now, the negative [effect] from all the scaling back in real estate — whether it’s construction or sales or financing — is showing up in the economy,” said Rajeev Dhawan, director of the Economic Forecasting Center at Georgia State University.

“That is enhanced by the record high gas prices we have had,” Dhawan said. “The $4-a-gallon gas has done its damage.”

Gas prices have dipped in recent weeks but still remain around the levels of midspring, which at the time were record highs, according to AtlantaGasPrices.com.

Adding to consumer woes, prices of food and other items are climbing while the buying power of paychecks shrinks: The average of inflation-adjusted earnings declined 2.9 percent during the past year, according to the U.S. Bureau of Labor Statistics.

Meanwhile, the economy also struggles with a glut of homes for sale and a credit crisis linked to hundreds of thousands of foreclosures.

The national economy has shed about 463,000 jobs since December, according to the Bureau of Labor Statistics. Payrolls are 67,000 jobs below the level of a year earlier.

Georgia has to outpace most states to keep its jobless rate from climbing, said economist Roger Tutterow of Mercer University.

The state continues to attract people from other parts of the country, so the work force expanded by 80,182 in the past year.

“We have to create more jobs than other states just to hold the unemployment rate stable,” Tutterow said.

While the unemployment rate has been rising during the past year, Georgia payrolls have expanded by 14,679 jobs.

However, payroll expansion seems to have recently gone into reverse.

Athens was the state’s only metro area to add jobs in May. Not a single metro area added jobs in June. Overall, Georgia lost 21,900 jobs in May and 46,600 jobs in June, state Labor Commissioner Michael Thurmond said.

Metro Atlanta accounted for about half the losses.

The result has been a wave of people seeking new jobless benefits, Thurmond said. “From Blue Ridge to Atlanta, from Macon to Valdosta, thousands of unemployed Georgians are pouring into our career centers.”

The state currently counts 304,536 unemployed Georgians looking for work, he said.

The official jobless rate does not include people who are too discouraged to look for work or others who take part-time jobs because they cannot find full-time positions.