State unemployment rate drops to 6.6 percent, lowest in 5 years

OLYMPIA – A significant drop in the seasonally adjusted rate of unemployment in December, combined with an increase in estimated total jobs, provide reasons for optimism about the state’s labor market.

The Employment Security Department’s estimated unemployment rate for December was 6.6 percent, down from 6.8 percent in November. The last time the state’s unemployment rate was this low was in November 2008, when it was 6.5 percent.

Meanwhile, the state gained an estimated 4,800 in December, amounting to an increase of 0.2 percent. Economists also revised the November preliminary job numbers upward by more than 4,000, from a loss of 6,000 to a loss of 1,600.

Paul Turek, an Employment Security labor economist, said the drop in December’s unemployment rate was caused primarily by a shrinking labor force as discouraged job seekers stopped looking for work. Nevertheless, Washington’s labor market appeared to be stronger in December than the previous two months, he said.

“We’re not heading southward, we’re heading northward,” said Turek. “It was a baby step in the right direction.”

As usual, job gains and losses varied by industry sector. Big gains were seen in professional and business services, where 2,900 new jobs were added, largely in temporary agencies. Jobs in private education and health services increased by 2,000. Other services, a catch-all category including auto body shops and nail salons, added 1,400 jobs. Wholesale trade increased by 1,300; construction by 800; leisure and hospitality, 600; and mining and logging, 100.

The greatest job losses were reported in government, which shed 1,500 jobs, and manufacturing, which lost 1,400. All of the lost government jobs were state agencies and public colleges. In manufacturing, job losses were predominantly in food processing.

Other sectors with jobs declines included information and retail trade, which were both down by 400 jobs. The transportation, warehousing and utilities sector and the financial activities sector each lost 300 jobs.

Over the past year, an estimated 41,800 jobs have been added in Washington. Since the low point of the recession, when 205,000 jobs were lost, 170,600 (83 percent) have been added.

In December, an estimated 227,900 people (seasonally adjusted) in Washington were unemployed and looking for work. That includes 125,200 who claimed unemployment benefits last month.