The Associated Press July 22, 2011, 2:10PM ET

NC jobless rate up in June, well above US mark

North Carolina's unemployment rate jumped to 9.9 percent in June as community colleges, universities and other state government employers cut 7,600 workers, the state Employment Security Commission said Friday.

June's jobless rate rose from May's 9.7 percent rate, the level where it had been stuck for three months. The number of unemployed increased by 9,516 workers to 446,377.

The national unemployment rate rose to 9.2 percent last month, the highest this year. Still, North Carolina has exceeded the national unemployment rate every month since November.

Government was the big job-loser in June, cutting 10,200 jobs as school boards, municipalities and state agencies tightened belts. Local school districts in nearly two dozen counties reported laying off 3,000 workers in June, an Employment Security Commission report said.

But while schools lay off some workers in June each year -- some of them to be rehired with the start of the academic year in the fall -- state agencies cut more jobs than usual last month, commission spokesman Larry Parker said.

"When we look at that breakdown of government loss, we do see a little bit higher portion of state government loss than what we saw last year," he said.

The number of government jobs lost may continue increasing. North Carolina's Legislature closed a $2.5 billion budget shortfall projected for the fiscal year that began this month primarily by cutting spending. The budget, written by Republicans fully in control of the General Assembly for the first time in more than a century, took effect after lawmakers overrode a veto by Gov. Beverly Perdue, a Democrat.

The lost government jobs are one indication that Republican efforts to downsize government are working, state Republican Party Chairman Robin Hayes said.

"I hope it does increase," Hayes said of the prospect of further state government layoffs. "Republicans were elected on the basis of rightsizing government, making it smaller. This is the first indication, now that Republicans are in office, that this is beginning to occur."

Employment Security Commission data indicate that in the four years ending in June, government jobs became a larger piece of North Carolina's employment pie as private sector jobs dried up.

Government jobs represented 16.5 percent of the state's jobs in June 2007, compared with 17.6 percent last month. That higher percentage could be the result of serious losses of manufacturing, construction, trade, transportation and other private sector jobs. North Carolina lost 282,300 non-farm jobs in that four-year period.

The increased role of government in the state's economy is one thing Republicans have aimed to reverse, Hayes said.

"That had to be turned around, and Republicans are instituting policies, unlike Gov. Perdue, that will incentivize small businesses and the private sector to grow their businesses and to shrink, right-size is a good word, the size of state government," he said.

June's other big job-loser was the sector that includes professional, scientific, technical and administrative workers at private companies. That sector lost 5,400 jobs, the bulk of them from administrative and support positions, the ESC said.

The only sectors adding a substantial number of jobs were hotels, restaurants and other hospitality businesses, who hired an extra 4,400 workers in June, the agency said.

The number of workers drawing a paycheck has grown by 11,000 in the past year, and the number unemployed has fallen by more than 28,000. Official jobless figures don't count as unemployed people who have stopped looking for work or settled for part-time jobs. The U.S. Labor Department estimates that as many as 17.5 percent of North Carolina's workforce may be unemployed or underemployed.

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Emery Dalesio can be reached at http://twitter.com/emerydalesio


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