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Economic Development News

Delaware unemployment rate continues fall in August 

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DOVER – After peaking in May, the state’s unemployment rate continued its three-month fall in August, dropping 1.6 percentage points to 8.9%, marking the first time amid the pandemic that the rate has fallen under the pre-pandemic record of 9.8%, according to state officials.

The August monthly unemployment report released Sept. 18 by the Delaware Department of Labor showed that 5,100 more people went back to work last month despite a slowing recovery of the state economy that has been stuck in Phase 2 since mid-June. It adds to the more than 31,000 jobs that we added back between May and July, but that comes off Delaware’s staggering loss of 74,700 in April.

Despite continuing positively from the record-breaking unemployment rate of 15.9% in May, the August rate was slightly higher than the national monthly average of 8.4%. It also comes as nearly 1,600 people filed for unemployment assistance in Delaware last week – a rate that has been fairly consistent for the last four weeks. The number of continuous claimants has continued to fall though, totaling a little more than 35,000 recipients last week, the lowest level since late March.

Despite having a less drastic surge of viral cases than in other larger states in the South and Southwest, Delaware is still lagging its peers in recovery. Its 8.9% August unemployment rate ranks 11th 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 ninth worst with an unemployment rate of 10.9% and Pennsylvania ranking 10th worst at 10.3%. Maryland is doing considerably better, ranked tied for 20th best at 6.9%.

Nebraska had the lowest unemployment rate at 4%, while Nevada had the highest at 13.2%, 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 44,500 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 138,000 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 9.4%, 9.8% and 7.6%, 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 14.5% and 13.3% of workers were unemployed, respectively.

One more concerning fact in the August jobs report was that Delaware’s labor force dropped 4,800 workers after gaining them for three consecutive months and setting a record high in July. The labor force captures not only workers and those receiving unemployment benefits, but also those in search of work who aren’t receiving assistance.

The largest monthly gain came from the retail sector, where in-store shopping is more widely available under Phase 1 and 2 of the state’s reopening plan. It added 1,700 jobs.

Governments of all sizes also added back 1,000 workers after most settled their Fiscal Year 2021 budgets by the end of June.

The leisure and hospitality sector, which includes restaurants, hotels and entertainment venues that were battered by the months-long closures, added 700 jobs while the education and health sector added 600 and manufacturing added 500.

Several sectors saw limited job losses in August, including 400 in financial services, and 100 losses each in the information sector and the professional and business services sector.

By Jacob Owens


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