State’s unemployment rate dips slightly

DOVER — Delaware’s unemployment rate fell to 3.5 percent in January, according to revised data released Friday by the Delaware Department of Labor.

While prior figures indicated Delaware’s rate was worse than the national average for most of 2018, the new numbers reveal unemployment levels have been lower in Delaware than the nation as a whole from June onward.

Nationally, 4 percent of the workforce did not have a job in January. In January 2018, 4.1 percent of people both in Delaware and nationwide were out of work.

Delaware’s 3.5 percent rate is a 0.1 percent decrease from December. The state also achieved 3.5 percent unemployment in November, its best mark since 2007.

Despite that good news, the number of jobs added, which is based off a separate survey and model, plummeted after the revision.

The U.S. Bureau of Labor Statistics said in December Delaware gained 10,000 jobs in 2018, while the data released Friday indicates it actually picked up only 3,800.

The discrepancy in unemployment rate and number of jobs added stems from two different methods being used to calculate them and from the state’s population growth being smaller than expected.

George Sharpley, chief of the Office of Occupational and Labor Market Information in the Department of Labor, was not surprised by the change, noting state payroll data indicated more modest growth than what the federal government predicted.

“I thought the jobs estimate had gotten a little carried away with itself,” he said, adding that the BLS does not seem to update its model to account for differences in what it predicts and what payroll data reveals.

The unemployment rate in January was 3.4 percent in New Castle, 3.8 percent in Kent and 4.4 percent in Sussex. However, unlike the state’s rate, the county figures are not seasonally adjusted.

Dr. Sharpley does not expect the unemployment rate to drop much further.

“The economy is growing at a decent pace, but it’s not gangbusters and there’s no evidence of any kind of recessionary movement,” he said.

Despite that, he said he believes there is a “fairly high likelihood” the country will be in a recession when 2020 begins.

“Recessions are kind of like cliffs,” unseen until the drop-off is right in front of you, he said.

Long periods of economic growth are rare, and some economists have warned a recession in the near future is all but inevitable.

Over the past 70 years, the National Bureau of Economic Research says, the United States has been through 11 recessions. The think tank considers the last economic slowdown, the Great Recession, to have begun in December 2007 and ended in June 2009.

NBER data begins in 1854, and since that time, the United States has never gone more than 10 years without a recession.

Facebook Comment