The recession may be easing in areas across the country, but unemployment figures in the Charlottesville metropolitan area from December 2009 to January 2010 showed a significant increase in the number of area residents looking for work.
According to statistics obtained from the Virginia Employment Commission, unemployment rose from 5.4 percent in December 2009 to 6.6 percent in January 2010 in the metropolitan area. Within the City of Charlottesville alone, unemployment increased from 5.8 percent to as high as 8 percent during the same time frame.
Government jobs make up about one-third of all non-agricultural employment in the area - 30,300 out of 96,200 total non-agricultural jobs in January 2010, said Ann Lang, senior economist in the Economic Information Services Division of the Virginia Employment Commission. This sector lost the most jobs of any industry, and Lang attributed the fall to seasonal fluctuations in the demand for workers.
With 12,900 jobs in the area, the second-largest sector, trade and transportation, also experienced losses by about half that number because of decreased retail activity, Lang said. Professional and business services were unchanged, she said, while employment in the leisure and hospitality sector increased by 100 positions.
Experts cautioned against interpreting these statistics as evidence that the region's economy is in rapid decline. Other factors, such as an increase in the number of self-declared job-seekers, as well as the termination of employees who were hired only for the holiday season, may be to blame for the spike in unemployment.
Timothy Hulbert, president of the Charlottesville Regional Chamber of Commerce, emphasized that unemployment figures are only part of the total economic picture and cautioned against drawing premature conclusion as to the cause of the spike.
"We tend to not look at ... any one month or season," he said. "We want to know what the long-term trend is, as it relates to employment."
Lang said other factors could explain the disparity, as well.
As more economists come to believe the recession has ended, she said, more people who had stopped looking for work will begin looking for jobs again, driving up the unemployment numbers for a short period of time. Unemployment figures calculate the percentage of the total population in a region that is actively seeking work. Those who choose not to work or who do not declare themselves as actively seeking jobs are not included in the total figures.
"Sometimes, if people see others getting jobs or are more confident that there's going to be a turn, they may enter the workforce to look for a job," Lang said. "If they're not actively seeking work, they're not in the figures."
She also said although the striking differences in the numbers may point to possible sampling error in the survey, there were no outliers in the data or procedural errors that could otherwise produce such an anomaly.
Moreover, she said, the sharp rise in unemployment from December to January may be because of seasonal factors that arise each year. The unemployment rate rose during the same time period the year before from 4.1 to 5.3 percent. This is often because after the holiday season ends, retailers reduce the number of extra workers they had hired in the weeks before. Additionally, Lang explained, holiday resorts and tourist attractions in the area typically have decreased demand after the celebration of the new year and therefore choose to let go of staff at that time.
Individuals who reside within the City of Charlottesville but work outside it also may have played a part in the increased unemployment percentage. For these people, "if there's any kind of layoff or closure, you're counted as if you reside in the city," Lang said. Employment reductions in the metropolitan area thus could have indirectly caused a larger percentage of city unemployment, she said.\nOverall, experts agreed that these figures are cause for concern, and more work must be done during the next few months to pinpoint the cause of the spike in unemployment.
"It may not be all bad news due to the combination of seasonal and economic factors," said Michael Harvey, president of the Thomas Jefferson Partnership for Economic Development. "Maybe it's the darkness before the light, but we've still got a ways to go"
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