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Payrolls Fall in 34 U.S. States, Led by California

Payrolls dropped in 34 U.S. states in September, led by California and New York, showing job losses were dispersed throughout the country.

Employers in California cut 63,500 jobs last month, figures from the Labor Department showed today in Washington. New York followed with a loss of 37,600, while employment in Massachusetts decreased by 20,900 and by 20,200 in New Jersey.

The labor market has been slow to improve as state and local governments cut staff to repair budget shortfalls and companies wait for an increase in sales. The government said earlier this month that U.S. companies added 64,000 jobs in September, less than economists forecast, and total payrolls dropped by 95,000.

Corporate job gains are “weaker than we’d all like, barely enough to keep unemployment constant,” Kurt Karl, chief U.S. economist at Swiss Re in Armonk, New York, said before the report. “The economy needs to strengthen more for businesses in general to hire.”

Nevada’s jobless rate held at 14.4 percent in September, the highest in the U.S.

Nationally, seven of eight employment categories showed declines in payrolls, led by a loss of 83,000 government jobs and a 45,000 drop in construction. Financial services had a gain. More than half of California’s decrease, 37,300, reflected cutbacks at government agencies, which may include reductions due to the winding down of the decennial census and schools.

Unemployment Decreases

Unemployment decreased in 23 states, led by a 0.4 percentage-point drop in Massachusetts, and 0.3 point decreases in Alabama, Maine and Rhode Island. Eleven states showed an increase in the jobless rate, led by a 0.4 percentage point jump in West Virginia. The jobless rate is derived from a survey of households while the payroll figures are calculated from a survey of employers.

Michigan, with a jobless rate of 13 percent, was second to Nevada and California was third at 12.4 percent. Unemployment in North Dakota remained the lowest in the nation at 3.7 percent.

Payrolls climbed in 16 states and in the District of Columbia, which led all advances with a 16,500 jump in employment. North Carolina followed with a 10,100 gain and Illinois with an 8,600 increase.

New York City

New York City’s unemployment rate dropped to 9.3 percent in September, the lowest in 16 months, the state Labor Department said yesterday. The states’ jobless rate held at 8.3 percent.

New Jersey’s jobless rate decreased to 9.4 percent from 9.6 percent in August, the state labor department said on Oct. 20. The state said most of the decline in the jobless rate was from people leaving the labor force. The drop in payrolls reflected a 7,600 decrease in local government positions.

At the national level, the 14 months of unemployment at 9.5 percent or higher is the longest stretch since records began in 1948. Economists surveyed by Bloomberg News earlier this month projected joblessness will average 9.6 percent this year and 9.3 percent in 2011.

State and local employment data are derived independently from the national statistics, which are typically released on the first Friday of every month. The state figures are subject to larger sampling errors because they come from smaller surveys, making the national figures more reliable, according to the government’s Bureau of Labor Statistics.

Government Payrolls

State and local government employment cuts were part of the reason national payrolls fell in September. While the $26 billion aid package approved in August to help states fill budget gaps may have allowed municipalities to cancel firings or rehire some laid off workers, tax collection shortfalls probably will continue to prompt reductions.

U.S. cities expect their financial strains to worsen, according to a survey by the National League of Cities that was released Oct. 6. Eighty percent of city finance officers expect to have more difficulty balancing their budgets in the 2011 fiscal year, which began in June for most municipalities, than during the prior period, according to the survey. The survey was conducted of 338 cities from April through June.

Some companies also continue to cut jobs to bring down expenses. Xerox Corp., the printer and business-services provider, yesterday raised its 2011 profit forecast and said it plans to eliminate 2,500 jobs. The cuts, about 2 percent of the workforce, will come in the next 12 months, spokesman Carl Langsenkamp said in an interview.

Others are seeing enough of a rebound in demand to start hiring.

Delta Air Lines Inc. said Oct. 15 it is adding 1,000 flight attendants, many of them to work on more profitable international flights, as global demand for travel improves. The company first offered the jobs to attendants who were on furlough and 425 accepted, Chief Executive Officer Richard Anderson said in his weekly recorded message to employees. About 600 of the positions will be filled by new hires, according to spokeswoman Betsy Talon.

To contact the reporter on this story: Courtney Schlisserman in Washington at cschlisserma@bloomberg.net

To contact the editor responsible for this story: Christopher Wellisz at cwellisz@bloomberg.net

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