Long Island’s unemployment rate rose to 13.8% last month as more Long Islanders entered the workforce in hope of finding jobs, state data released Tuesday shows.
The unemployment rate in July grew by one percentage point from the 12.8% rate reported for June. The jobless rate for July of last year was 3.8%.
Shital Patel, labor market analyst in the department's Hicksville office, said the recent increase is likely due in part to significant growth in the overall labor force – including those already employed but also those who are actively looking for work in response to more businesses opening up.
“As conditions appeared to be getting better, people are re-entering the labor force, but they don’t necessarily have jobs yet, which is driving up the unemployment rate,” she said.
The L.I. labor force grew by 60,200 in July, according to Labor Department data. Of that increase, 36,500 individuals were counted as employed, while 23,800 were looking for work.
In addition to the “continued reopening of the economy,” Patel said, unemployed Long Islanders “may be comfortable re-entering the workforce” amid lower infection rates and greater containment of the virus than during the worst of the pandemic.
Lori Belmonte, a co-owner of children’s apparel store The Colony Shop along with her aunt Lorice Fiala, said their 74-year-old Patchogue business has been hit hard by the shutdown, and that they have not been able to bring back their regular staffer, who is still collecting unemployment.
“I’m hoping I can bring them back soon,” said Belmonte, who had to shut down the East Main Street shop in March. “This business, my aunt and I own it, and we’re not even back full time.”
While businesses on the Island continued to reopen in July, John A. Rizzo, chief economist for the Long Island Association business group, said the uptick in unemployment may be an early sign that businesses and the customers they serve are in dire need of sustained aid from Washington.
“The comforting thing is it’s not a big increase,” Rizzo said. “But if we get the desperately needed bailout, things will improve. It's more evidence that we need a bailout.”
Pointing to the unproductive negotiations between the U.S. Senate and House over the extension of enhanced unemployment benefits, Rizzo said “More aid is needed or that number is likely to get worse.”
Congress, having failed to renew or replace the extra $600 in federally funded unemployment payments, remains on recess until Labor Day.