LI jobless rate climbs to 7.4 percent

Sue Marturano of Hicksville was laid off in Sue Marturano of Hicksville was laid off in July 2010 and remains unemployed. Her benefits are about to run out. (June 19, 2012) Photo Credit: Newsday / Audrey C. Tiernan

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With job growth slowing, Long Island's unemployment rate rose to 7.4 percent in May from 6.7 percent a year earlier.

The increase raised concerns that the region's level of joblessness could remain persistently higher than before the financial crisis.

The higher unemployment rate, as calculated Tuesday by the state Labor Department, reflects that more unemployed workers are resuming their job searches, local economists said. Only people looking for work are counted as unemployed; compared with the previous year, their numbers jumped by 10,900 in May.

The local jobless rate has now moved closer to the nation's, which was 7.9 percent in May. But the Island's rate is significantly below New York State's 8.6 percent. Like the Long Island rate, these state and national numbers are not seasonally adjusted.

The rise in the ranks of the unemployed was "basically due to the re-entry into the labor force of discouraged workers," said Shital Patel, labor market analyst in the department's Hicksville office. But they resumed looking for jobs at a time when employment growth was slowing down.

May marked the 41st consecutive month of jobless rates above 6 percent.

The rate in May 2007 -- seven months before the recession began -- was 3.5 percent, roughly what economists consider full employment.

But the "new normal" jobless rate for Long Island may now be 6 percent, said Pearl Kamer, chief economist for the Long Island Association, the Island's largest business group.

"We're never going back to the 4 percent level," Kamer said. "With technology replacing labor, the demand for labor in our economy has been permanently reduced. So we will see a higher new normal unemployment rate."

The Island had 108,500 unemployed workers last month, compared with 97,600 a year earlier. The number of employed workers dropped slightly to 1.358 million, versus 1.360 million a year earlier.

Recent job growth in professional and business services and in financial activities -- two of the Island's highest-paying employment sectors -- may have encouraged some unemployed workers to try their luck again, Kamer said.

"People with occupational skills in those industries are jumping back into the labor market in the belief that it will be easier for them to find a job today than it was six months or a year ago," she said.

But job growth is slowing on Long Island. Last week, the state Labor Department said the Island had just 9,100 more jobs in May, compared with the year before. That contrasted with monthly reports earlier this year showing that employment was up as much as 19,900 jobs year over year. (The unemployment report Tuesday counts workers, not jobs.)

Hicksville resident Sue Marturano, 53, an unemployed administrative assistant, knows firsthand how challenging the job market has been. She has been unemployed since July 2010, when she faced at least her fourth layoff since 2007 in some of Long Island's hardest-hit sectors, such as housing and insurance. In July 2010, she lost her job at an insurance-fraud investigation firm.

"I don't even want to show people my resume because it looks like I can't hold a job," said Marturano, who added that her unemployment benefits would end in about a week.

And the most that prospective employers have offered her is $10 an hour, compared with the $15 to $17 an hour she was seeking. "It's like totally going backwards to take a job for that much," she said.

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