Unemployment rate lowest in state since 2008

DOVER — Delaware’s unemployment rate slipped below 4 percent last month for the first time in a decade. Data released Friday by the Delaware Department of Labor indicates the state’s unemployment rate fell to 3.9 percent in June, the best mark since February 2008.

Additionally, with the national unemployment rate rising from 3.8 to 4 percent, Delaware’s employment level is better than the country’s as a whole for the first time since February 2017.

“The main takeaway is that it’s essentially good news,” Office of Occupational and Labor Market Information chief George Sharpley said. “The economy, it continues to improve. The numbers are good but they’re not too good, they’re not dramatically where you’d expect it’s going to cause some issues.”

The First State’s unemployment rate has fallen each of the past five months and is now down .7 percent from last June.

According to the Economic Policy Institute, the unemployment rate increased in only six states. Delaware saw one of the largest decreases from March to June.

From north to south, the rates for Delaware’s three counties are 4, 4.7 and 3.7 percent, respectively. Unlike the statewide figure, the county rates are not seasonally adjusted, however.

The state’s all-time record for unemployment (since 1976, at least) is 3 percent, last achieved in September 1987. Dr. Sharpley expects Delaware’s rate could approach that, possibly dropping to 3.5 percent by the end of the year, but he does not think Delaware will set a new record.

The last time Delaware reported unemployment of less than 4 percent was February 2008, when the state saw 3.9 percent of its population out of work. Thirteen months later, however, the state’s rate had more than doubled. It would continue to climb during the Great Recession, peaking at 8.8 percent in January 2010.

This low rate does not indicate a downturn is coming, Dr. Sharpley said, referring to Delaware as being in the “Goldilocks” zone.

While some people have credited the federal tax cuts approved in December for driving down unemployment, Dr. Sharpley believes that’s not the case, noting policy changes can take years to really impact unemployment.

“If you look at the long-term data, and I’m not speaking just for Delaware here but for the nation, you see a continuous trend. It’s not like anything has happened in the last year or so that has changed things,” he said.

While Delaware posted its best unemployment level in 10 years, the state’s labor force participation rate is several percentage points lower than it was before the Great Recession began driving unemployment up. In February 2008, the labor force participation rate was 66.3 percent, compared to 62.5 percent last month.

That’s not really a cause for concern for Dr. Sharpley, as he attributes the decrease to a simple increase in elderly individuals.

“We don’t have this army of underemployed and unemployed people just waiting to get back in,” he said.

According to the U.S. Census Bureau, Delaware has a higher percentage of residents age 65 or older than the nation at large. Many retired Americans from nearby states move to Delaware, and especially to Sussex County, for the low property taxes.

Staff writer Matt Bittle can be reached at 741-8250 or mbittle@newszap.com. Follow @MatthewCBittle on Twitter.

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