Georgia’s unemployment rate dropped to 8.1 percent last month, the lowest level in nearly five years, offering hope that the state’s economy could soon shift into full-recovery mode.
Not since December 2008, as the Great Recession growled into gear, has the jobless rate been so low, the state’s labor department reported Thursday. A year ago, the rate stood at 8.8 percent.
Georgia’s job gains — 30,000 the last two months — came as government dysfunction in Washington, aka sequestration, threatened to throttle the nation’s tepid economic recovery. But the stock market rolled right along. And the nation’s overall economy grew better than expected.
“Companies are starting to hire again,” said Mike Dugan, in charge of private business development for RA-LIN and Associates, a Carollton construction company. “We’ve hired maybe four people over the last month. If we had dropped people during the recession, we’d be hiring 10 or 20 people. But we kept a pretty robust workforce through the downturn.”
One month’s rosy statistics, though, do not a recovery make. Earlier this year, for example, the state’s jobless rate dropped four successive months bottoming out at 8.2 percent in April. Happy days were on the horizon. Then the unemployment rate ratcheted back up to 8.8 percent in July.
Georgia netted 85,500 jobs over the last year, the labor department reported Thursday. Yet the state remains roughly 220,000 jobs shy of pre-recession employment levels. At its current pace, Georgia needs another 15 months to recoup all jobs lost during the recession.
“2014 will be the first year in many years that Georgia will out-perform the nation in employment, but not by a huge margin,” said Jeffrey Humphreys, an economist at the University of Georgia. “We’re more dependent on the housing industry than most states and that industry is taking longer to gain traction.”
Humphreys cites another troubling trend: the state’s labor force participation rate, which gauges the number of people working versus the total working-age population. The rate typically rises when lots of jobs are available. Georgia’s rate — 63.4 percent — is headed in the wrong direction.
“A lot of people have been taking themselves out of the game because they’re so discouraged of finding a job,” Humphreys said. “But we may be getting close to the inflection point. It wouldn’t surprise me if, at the tail end of this year or early next year, we reverse that trend and increase labor force participation.”
October’s job gains, compared to a year earlier, crossed the board: trade and transportation (up 6,800); education and health services (up 5,400); and government (3,900).
“And, most importantly,” said labor commissioner Mark Butler, “more than 7,500 jobs have been created in construction in Georgia.”
A resurgence of construction is of manifold importance to Georgia. The industry supports builders, developers, real estate agents, mortgage brokers, loggers, factory workers, salesmen, truckers and more. Dugan’s commercial building company has been busy with distribution centers, retrofits, stand-alones and more.
“One of the good things about construction projects is that they can last for a year, year-and-a-half, sometimes two years,” said Dugan who’s also a state senator. “We hope that some of the tentative projects out there looking to expand or build or renovate will come through. If they do, 2014 will be a pretty good year.”
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