Augusta Economy

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Unemployment applications drop to lowest since April '08

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WASHINGTON — In in the latest sign that the economy is surging at year’s end, unemployment claims have dropped to the lowest level since April 2008, long before anyone realized that the nation was in a recession.

Claims fell by 4,000 last week to 364,000, the Labor Department said Thursday. It was the third straight weekly drop. The four-week average of claims, a less volatile gauge, fell for the 11th time in 13 weeks and stands at the lowest level since June 2008.

While the economy remains vulnerable to threats, particularly a recession in Europe, the steady improvement in the job market is unquestionable.

“The underlying trend is undeniably positive,” said Jennifer Lee, senior economist with BMO Capital Markets. “I think everyone is starting to come around to the view that, yes, there is a recovery going on.”

Unemployment claims are a sort of week-to-week EKG for the job market. Except for this spring, after the earthquake and tsunami in Japan hurt U.S. manufacturing, they have fallen steadily for a year and a half.

Claims peaked at 659,000 in March 2009. In the four years before the Great Recession, they mostly stayed between 300,000 and 350,000. That claims are edging closer to that range is a sign that the layoffs of the past three years have all but stopped.

The steady decline may also herald a further decline in the unemployment rate, which fell in November to 8.6 percent from 9 percent the month before. The December rate will be announced Jan. 6.

If unemployment claims keep declining, the unemployment rate might fall as low as 8 percent before the November elections, said Dan Greenhaus, chief global strategist at BTIG LLC, a boutique brokerage.

Economists will also watch closely on Jan. 6 to find out how many jobs were added this month. At least 100,000 were added each month from July through November, the best five-month streak since 2006.

“When you fire fewer people, hiring unquestionably follows,” Greenhaus said. He expects employers to create as many as 200,000 jobs per month if the trend continues.

In another encouraging report Thursday, the Conference Board’s index of leading economic indicators rose strongly in November for the second straight month, suggesting that the risks of another recession are receding.

The index puts the economy on track to grow at a 4 percent annual rate in the fourth quarter, which ends this month, said Ian Shepherdson, chief U.S. economist with High Frequency Economics.

The economy hasn’t posted 4 percent growth or stronger since the first quarter of 2006, when it grew at a 5.1 percent rate. The best it has done since the recession was 3.9 percent, in the spring of 2010.

LOCAL UNEMPLOYMENT RATES

COUNTY        NOV. 2011         OCT. 2011      NOV. 2010

Aiken County           7.7%                    8.8%                   8.5%

Edgefield County     8.7%                    9.7%                   9.5%

Burke County           11.0%                 10.4%                 11.3%

Columbia County     7.0%                   7.5%                    7.1%

McDuffie County      11.1%                  11.2%                 10.1%

Richmond County    10.0%                10.4%                 10.5%

AUGUSTA JOBLESS RATE DOWN

The unemployment rate for metro Augusta tumbled to 8.7 percent in November, down from 9.3 percent in October.

The Georgia Department of Labor reported Thursday that the rate declined because there were fewer layoffs in construction, retail trade, and administrative and support services.

Producing the lower rate was a combination of 2,477 fewer people looking for work, which lowers the labor force, and 1,744 fewer unemployed.

Despite a drop in the number of people with jobs compared to October, there were 1,000 more people employed in November than a year ago.

The jobless rate in the six-county Augusta area in November 2010 was 9.1 percent.

Metro Athens had the lowest area rate at 6.9 percent, while metro Dalton had the highest at 11.8 percent.

Meanwhile, Georgia’s seasonally adjusted unemployment rate had its largest one-month decline since 1977, falling to 9.9 percent from 10.2 percent in October. The jobless rate was 10.4 percent in November a year ago.

The state rate dropped because of an increase of 22,400 jobs. In addition to retail trade, growth also came in financial and business services and education and health care.

– From staff reports

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