Delaware unemployment rate drops again in July

DOVER – The state’s unemployment rate continued its three-month fall in July, dropping more than 2 percentage points to 10.4% and largely matching the national average, according to state officials.

The July monthly unemployment report released Aug. 21 by the Delaware Department of Labor showed that 7,300 more people went back to work despite a slowed reopening of the state economy that has been stuck in Phase 2 since mid-June. That adds to the more than 24,000 jobs that were added back in May and June, after Delaware’s staggering loss of 74,700 in April.

Despite continuing positively from the record-breaking unemployment rate of 15.9% in May, the July rate is still higher than the pre-pandemic record of 9.8% in November and December 1976. It comes as more than 1,000 people continue to file for unemployment assistance in Delaware as well, with 1,678 filing the week of Aug. 22. The number of continuous claimants has fallen to under 40,000 though, the lowest level since mid-April.

After weeks of lagging behind the national average, Delaware nearly matched the 10.2% national unemployment rate in July.

Despite having a less drastic surge of viral cases than in states in the South and Southwest, however, Delaware is still lagging its peers in recovery. Its 10.4% July unemployment rate ranks 16th worst among all states, according to the U.S. Bureau of Labor Statistics (BLS).

Delaware’s trend continues to track toward its larger northern neighbors, with New Jersey ranking fifth worst with an unemployment rate of 13.8% and Pennsylvania ranking sixth worst at 13.7%. Maryland is doing considerably better, ranked tied for 16th best at 7.6%.

Utah had the lowest unemployment rate at 4.5% in July while Massachusetts continues to have the highest at 16.1%, according to BLS.

The Delaware Department of Labor’s report, which is taken monthly during the calendar week that contains the 12th day, showed that 52,600 workers were unemployed. Tom Dougherty, chief labor market economist for the department, previously explained that the monthly unemployment figure is created from looking at continuous unemployment insurance claims as well as a BLS survey of residents on their employment status.

The official monthly unemployment statistic tracks not only those receiving benefits, but also those who are ineligible, such as terminated employees, those who have resigned and the self-employed, who only became eligible for assistance under a special federal program established under the CARES Act.

While more than 130,000 workers have filed for unemployment assistance in the wake of the pandemic, most because of statewide business closures mandated by Gov. John Carney to stem the spread of the virus, the state also had 19,400 unemployed workers in January, before the pandemic struck the U.S.

Dougherty said it’s important to remember that the monthly report is just a “snapshot” of one week in time.

The state’s three counties saw similar rates of unemployment with New Castle, Kent and Sussex counties reporting rates of 10.9%, 11.5% and 9.1%, respectively – although those statistics aren’t seasonally adjusted. Wilmington and Dover, the state’s two most populous cities, have seen an even greater impact in job losses, where around 16% of workers were unemployed, dropping several percentage points from June.

Continuing some good news in July was that Delaware added 19,200 workers back to the labor force after adding more than 24,000 in May and June. It sets a new record high for people in search of work, suggesting to employers that an ample labor base can be found in Delaware.

The largest monthly gain came from the leisure and hospitality sector, which includes restaurants, hotels and entertainment venues that were battered by the months-long closures. It added 4,300 jobs back as restaurants were allowed to reopen dine-in service and hotels began to host visitors again.

The next largest gain came in the education sector, which is preparing for the new school year that will largely be completed online, and the health care sector, which is once again allowing elective procedures and routine visits. Together they added back 1,400 jobs.

Retail, where in-store shopping was more widely available under Phase 1 and 2 of the state’s reopening plan, added 1,000 jobs.

Several sectors saw limited job losses in July, including 300 in transportation and utilities, and 100 each in durable goods manufacturing and professional and business services.

By Jacob Owens

jowens@delawarebusinesstimes.com