Springs jobless rate highest in a decade

The unemployment rate in the Colorado Springs area surged in November to 9.5 percent, the highest level in at least a decade. with a record of nearly 29,000 residents without jobs, the Colorado Department of Labor and Employment reported Friday.

The jobless rate, which is adjusted for seasonal changes, was up from 9.2 percent in October. It has increased for seven consecutive months and is nearly 2 percentage points higher than it was a year ago. The November rate is the highest since at least 2000 and matches February 1975 as the highest seasonally adjusted rate ever. No seasonally adjusted data is available for the 1990s, though the unadjusted rate never exceeded 8.5 percent.

Tom Binnings, a partner in Summit Economics LLC, a local economic consulting firm, said he expects the area’s unemployment rate to continue increasing and reach as high as 10 percent within the next six months as high school and college graduates enter the local job market and other workers move here. He also  anticipates further job losses in state government both locally and statewide as a new governor and legislators combat continuing budget shortfalls.

“The local economy may be adding some jobs, but not fast enough to absorb the growth in the labor force,” Binnings said. “I expect job growth to return next year, especially from the private sector, with the exception of the construction industry.”

The area’s payrolls continued to decline in November, falling 0.9 percent from a year earlier to 244,300, with the most job losses coming in construction, government and retailing. The only gains came in health care, tourism and information technology.

Fred Crowley, senior economist for the Southern Colorado Economic Forum, called the unemployment and payroll data “disappointing. It shows a stagnant economy that just isn’t growing.” He believes the area’s job market will avoid a double-digit unemployment rate as a result of legislation signed into law Friday by President Barack Obama that extends federal tax cuts for two years and reduces Social Security payroll taxes for one year.

Colorado’s jobless rate rose to a 27-year high of 8.6 percent in November, up from 8.4 percent the month before and 7.4 percent a year earlier. The November rate is the highest monthly rate for the state since February 1983, when 8.7 percent of the state’s residents were out of work. However, statewide payrolls were up from the previous month for the third consecutive time, the first time in more than three years.

The state’s unemployment rate is rising despite growing payrolls because people are entering the job market at a faster rate than jobs are being created.

Mike Kazmierski, CEO of the Colorado Springs Regional Economic Development Corp., said the rising local and state unemployment rates should “motivate the entire community to be more aggressive in job creation in the year ahead.”