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Originally published April 15, 2009 at 12:00 AM | Page modified April 15, 2009 at 4:51 PM

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9.2% unemployment in state -- and expect worse

Washington's economy is deteriorating at a pace not seen since modern record-keeping began more than three decades ago, according to the latest state jobs report.

Seattle Times business reporter

Washington's economy is deteriorating at a pace not seen since modern record-keeping began more than three decades ago, according to the latest state jobs report.

The unemployment rate took its third big jump in a row in March, reaching a seasonally adjusted 9.2 percent — a level last reached in May 1984, state data show.

The jobless rate, which stood at a relatively modest 6.5 percent as recently as December, has risen by half a percentage point or more each of the past three months, according to the state Employment Security Department.

To put that in perspective: During the last three U.S. recessions, only once (in November 2001) did the state jobless rate go up by that much in a single month.

"It's clearly a pretty dramatic downturn," said Greg Weeks, head of Employment Security's labor-market information branch. He called the trend of accelerating job losses "very troubling."

More than 344,000 Washingtonians reported being unemployed and looking for work last month — almost twice as many as a year earlier.

And nonfarm employers sliced an additional 20,000 jobs from their payrolls in March, bringing the total job losses to 104,600 since the peak last August.

The jobless rate also rose in the Seattle metro area, to a seasonally adjusted 8.1 percent, from a revised 7.6 percent in February.

Weakness was widespread throughout the state's economy, with no significant job growth in any industry or sector.

More job losses to come

And state forecasters say worse is to come. In a report issued last week, the state Economic and Revenue Forecast Council said it expects Washington to continue losing jobs through the rest of 2009, though at a slower rate. The official state forecast is for unemployment to peak at 10 percent during the first three months of 2010.

The state likely will recover along with the national economy, which has shown some signs of bottoming out, the forecast council said. But, it added, "employment is a lagging indicator, and it is normal for the economy to shed jobs even after a recovery is underway."


More than 224,000 people in Washington are collecting unemployment benefits.

First-time claims for benefits are averaging more than 15,000 a week, nearly 72 percent more than a year ago.

Out-of-work Washingtonians have plenty of company in their misery. The national jobless rate in March hit 8.5 percent, up from 8.1 percent in February.

And unemployment in Oregon soared to 12.1 percent last month, tying that state's record set at the peak of the recession of the early 1980s.

During that wrenching downturn, Washington's jobless rate topped out in November 1982 at 12.2 percent — a figure that once seemed a relic of the bad old days but now seems disconcertingly nearby.

William Conerly, an economist and business consultant in suburban Portland, said the two recessions that bracket this decade — the dot-com crash and the current downturn — were asset bubbles, in which overvalued assets — tech stocks then, houses now — led people and companies to spend more than the underlying real economy could justify.

By contrast, he said, the recession of the early 1980s was deliberately engineered by the Federal Reserve, which raised interest rates sky-high to battle inflation. Those high rates torpedoed the housing market, which in turn sunk the Northwest's wood-products industry.

"Right now I think this [recession] will end up being not quite as bad as that recession, but it could go either way," Conerly said.

Without adjusting for seasonal variations, Ferry County had the state's highest unemployment rate in March, 17.2 percent. Whitman County, at 5.8 percent, had the lowest rate. (The unemployment rate is calculated from a survey of 1,100 to 1,350 Washington households — not, as is sometimes thought, from counting how many people receive jobless benefits.)

One flicker of hope was that February's numbers weren't quite as dismal as first reported. The unemployment rate in February was revised down to 8.3 percent, from the preliminary 8.4 percent; 324,820 Washingtonians reported being jobless and looking, versus the initial estimate of 330,570.

And a handful of sectors did manage to add jobs in March. Clothing stores were up 700 jobs; general-merchandise stores and local government were up 600 jobs each.

Areas hit hard

But those glimmers were overshadowed by heavy losses in other areas of the economy. Construction shed 5,100 jobs in March; financial services was down 1,800 jobs; bars and restaurants cut 2,000 jobs; and health and social services were off 1,400 jobs.

Aerospace, an industry centered on Boeing, lost 500 more jobs last month. Boeing's in-state payroll has shrunk by 1,373 jobs since October, to 75,496 positions.

And software, a stabilizing force in previous recessions, seems unlikely to play that role this time around. Software-industry employment held steady at 52,200 last month, but Microsoft, the industry's keystone, plans to cut a net 2,000 to 3,000 jobs by the middle of 2010.

One place that will be hiring: the Employment Security Department itself. The department recently received $8.2 million in federal stimulus money, spokeswoman Sheryl Hutchison said; it will use the money to hire about four dozen staffers at its Workforce Development Centers to help other people find work.

Drew DeSilver: 206-464-3145 or

Copyright © 2009 The Seattle Times Company

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