Alabama unemployment drops for 1st time since 2007

AP News
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Posted: Dec 18, 2009 11:51 AM

Alabama's unemployment rate has dropped for the first time in more than two years, providing a positive sign for the state's work force _ but one that comes with words of caution.

The state Department of Industrial Relations announced Friday that Alabama's rate declined from 10.9 percent in October to 10.5 percent in November. The last time Alabama saw a drop was in September 2007.

Alabama's decline reflected a similar dip in the nation's jobless rate, which went from 10.2 percent in October to 10 percent in November.

Nationally, Alabama was one of 36 states showing declines. Preliminary numbers indicated Alabama dropped from 11th to 12th among the states in unemployment after peaking at 10th in September.

"We are certainly glad to see a drop in the unemployment rate, but we need to keep in mind that a one month drop is not a trend," state Industrial Relations Director Tom Surtees said.

Keivan Deravi, an economist at Auburn University Montgomery, said the decline was expected because the number of temporary workers nationally has been going up for three months. Retailers added temporary workers for holiday shopping, and some car plants and suppliers in Alabama resumed regular production schedules, he said.

"The key is to see how the economy holds up after January and February," he said.

Deravi, who has advised state officials on economic matters for years, said he expects Alabama and other states to see improvement by mid-2010 due to the hiring of census workers and construction companies beginning many projects funded by federal stimulus dollars.

Alabama's new unemployment rate represents 217,350 people out of work. That's down from 226,466 in October.

Surtees said the state saw gains in trade, transportation, utilities, professional and business services, educational and health services, and manufacturing. Losses occurred in financial services and leisure and hospitality.

Counties with the lowest unemployment in November were Shelby and Madison at 7.3 percent, Coffee at 7.8 percent, and Pike at 8.2 percent. Counties with the highest rates were Wilcox at 24.3 percent, Monroe at 21.1 percent, and Dallas at 20.3 percent.

Alabama's 10.5 percent rate for November compared to 6.2 percent a year earlier. At that point, Alabama was weathering the recession better than the nation as a whole, but that changed during the year.

The Bureau of Labor Statistics reported Friday that Alabama tied Florida and Nevada for the second biggest increase over the year at 4.3 percentage points. Michigan led the nation at 5.1 percentage points.