LI 2.7% unemployment rate matches region's record low for fifth time in over 30 years

Long Island’s jobless rate fell to a record low 2.7% last month, marking the fifth time in over 30 years the rate has fallen that low, but other trends in state labor data suggest unease over where the economy is headed.

Compared with September 2021, last month’s unemployment rate was down 1 percentage point, suggesting continued improvement as the region rebounds from early pandemic job losses, according to state Labor Department data released Tuesday. On a month-over-month basis, too, the Island saw a decline in its jobless rate, shrinking from 3.4% in August.

The Island last had a monthly rate of 2.7% in April and May of this year, and December of last year. Prior to that, the rate was last this low in December 1998, according to state data.

Despite the overall positive report, Shital Patel, labor market analyst with the state Labor Department’s Hicksville office said last month’s data hints at uncertainty ahead. A much smaller-than-average decline in the labor force last month suggests that more employers are holding onto seasonal hires while more workers are holding onto positions, she said.

In past years, the Island has seen the labor force — the sum of all employed plus unemployed Islanders looking for work — decline by around 23,500 residents each September as businesses shed summer seasonal workers, Patel said.

This year, however, the decline was only 7,800, suggesting that employers wary of the currently tight labor market are more willing to hold onto short-term hires.

Additionally in September, the Island typically sees a decline of 18,300 in the number of employed residents, though last month a small gain was reported.

“This September … the region had an increase of 2,400 employed residents, which may mean that more people are returning to the labor force or staying put in their jobs," Patel said.

“Fears of a recession, increasing layoff announcements at tech companies, persistently high inflation, and a volatile stock market may be reducing workers’ confidence about how quickly they can find a new job,” she said.

John Rizzo, economist and Stony Brook University professor, echoed the sentiment, adding that even as the Federal Reserve tries to combat inflation by raising interest rates, those efforts may not be lowering prices fast enough for concerned consumers and workers.

“Economic uncertainty and inflation fears are causing some employees to stick with jobs they otherwise might have left in favor of searching for something else,” Rizzo said.

Nassau also reported a jobless rate of 2.7%, down from last year, while Suffolk reported a rate of 2.8% last month. The jobless rate for the state was down to 3.9% last month from 5.7% a year earlier.

The municipalities on the Island with the highest and lowest jobless rates last month were Hempstead Village at 3.6% and Smithtown at 2.4%, respectively.