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Lehigh Valley Jobless Rate Hits 9 Percent: It is the Highest Since 1984. Good News? Unemployment Increasing More Slowly
Tuesday, July 28, 2009 10:29 AM


(Source: The Morning Call, Allentown, Pennsylvania)trackingBy Gregory Karp, The Morning Call, Allentown, Pa.

Jul. 28--Unemployment in the Lehigh Valley reached 9 percent in June, the highest jobless rate in a quarter-century, according to numbers to be released today by the Pennsylvania Department of Labor and Industry.

It's the latest sign that pain in the local labor market is likely to get worse before it gets better.

The region has shed nearly 11,000 jobs over the past year. That contributed to more than 38,000 local residents looking for work in June. The resulting unemployment rate of 9 percent is the highest the region has seen since 1984. That's when Apple introduced the first Macintosh computer, Bruce Springsteen was singing "Dancing in the Dark" on the radio and

"Miami Vice" debuted on TV.

The local jobless rate has been moving higher in lock step with the national unemployment rate, albeit remaining slightly lower. The Federal Reserve expects the national jobless rate to peak late this year at 9.8 percent to 10.1 percent. If recent history is a guide, that puts the Lehigh Valley unemployment rate on course to crest in the mid-9 percent range.

Local economist Kamran Afshar is more bearish.

" My guess is that we're going to see double digits," he said of the unemployment rate. His own surveys of Lehigh Valley purchasing managers have shown no signs of upturn in hiring or purchasing more goods and services. "Basically, businesses are not planning to do much. And that pushes the horizon, in terms of recovery."

Current reports show no letup. The number of first-time jobless claims, an indicator of new layoffs, was 27 percent higher than last June. The number of people who continued to get unemployment checks was 47 percent higher than last year.

Some 20,000 Pennsylvanians are estimated to have exhausted their jobless benefits this month, the first large wave of people who went through as many as 72 weeks of unemployment benefits.

Among the latest reports of layoffs is one from Air Products and Chemicals, the Lehigh Valley's third-largest employer. The company said it will close an unspecified number of plants and slash 1,150 jobs worldwide within a year. Air Products did not say if cuts will target workers at the company's Trexlertown headquarters or its plant in Hometown, Schuylkill County, which makes industrial gases. The report comes six months after the company announced plans to cut 1,400 jobs globally.

Across the Lehigh Valley, employers slashed 1,200 jobs in June alone, according to the state labor department. That means the region is home to 10,800 fewer jobs than a year ago.




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