State jobless rate soars

Unemployment at 7%, the highest rate in 2.5 years

South Carolina's unemployment rate took an alarming jump to 7 percent in July, the highest point in more than 2 1/2 years, an increase state officials attributed to manufacturing cutbacks and a spike in the number of job-seekers returning to the labor market.

The jobless rate hasn't been that high since October 2005, according to statistics from the State Employment Security Commission. It was almost a full percentage point above the revised June rate of 6.1 percent. Last July the rate was 5.8 percent.

The rate increase is another indicator of widespread economic troubles, manifested locally by a lull in tourism and a sluggish real estate market. In the Charleston area the jobless rate was 6 percent last month compared to 5.4 percent in June and 4.7 percent in July 2007.

"There are probably more negative signals than there are positives," said Frank Hefner, an economics professor at the College of Charleston. "The unemployment rate going up for the state is not a good sign, no matter how you slice and dice it."

The increase was echoed across the country as year-over-year rates rose in all but three states, Arkansas, Oklahoma and West Virginia. The national unemployment rate grew to 5.7 percent from 5.5 percent.

South Carolina, which for several years has had a relatively high rate of unemployment, had the seventh-worst rate in the country in July.

Paul Connerty, executive director of the local Trident Workforce Investment Board, said he has noticed more people visiting his office in search of employment opportunities. "The ports authority was recruiting, and our building was filled today," he said.

It's not clear whether the heightened interest comes from people who have lost their jobs, he said.

The job-seekers could have been visiting the office because the work the center was promoting would have been a better opportunity than their current jobs.

"I think that it's partially because of the slight increase in unemployment and partially because of the opportunities," he said.

Local government across the state posted the biggest job losses last month, with employment falling by 31,900 positions as schools released non-teaching staff for the summer.

Also, manufacturers shed 2,400 jobs and retailers cut 1,500 jobs.

The soft housing market cost the construction sector another 100 positions, marking the ninth consecutive monthly decline for the building industry.

Among the industries that added jobs were leisure and hospitality, up by 4,900 seasonal hires; professional and business services, up 700; and financial activities, up 400.

Hefner said the rising unemployment rate hints at deeper economic problems than high oil prices or the housing sector's woes.

"It's a combination of things, and that's making it hard for people to (determine) things like when we are hitting the bottom and when we are going to turn around," he said.

Reach John McDermott at 937-5572 or jmcdermott@postandcourier.com. Reach Katy Stech at 937-5549 or kstech@postandcourier.com.