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Report: Local jobless rates worsening

By Tom Wanamaker

ALBANY — New York state faces growing unemployment but does not have an adequate system in place to assist its residents who are out of work. So says a report by an Albany think tank.

The report, released Wednesday by the Fiscal Policy Institute, also reveals that area counties have considerably more of their residents out of work than at this time last year.

During the first six months of this year, Columbia County had 18.1 percent more unemployed people compared to the first half of 2007, while Greene County has seen a year-over-year jump of 17.5 percent.

In fact, 25 of the state's 62 counties experienced year-over-year unemployment increases of more than 20 percent, including Delaware (30.8 percent), Hamilton (27.9), Genesee (26.6) Niagara (26.5), Chenango (25.7), Franklin (25.6) and Washington (25.1).

Among neighboring counties, Dutchess saw year-over-year unemployment growth of 24.9 percent, while Ulster (24.0), Albany (22.3) and Rensselaer (18.9) fared similarly.

“Each week, 20,000 New Yorkers are filing new claims for unemployment insurance,” said James Parrott, FPI's chief economist, in a press release. “New York's job losses are mounting by the day with every indication they will rise further in the months ahead. This is particularly disturbing since the current downturn comes on the heels of a period of weak recovery and a shaky expansion from 2003 to 2007.”

Chronically high long-term unemployment also plagues the Empire State. In 2007, 22.4 percent of the state's unemployed were characterized as “long-term unemployed” meaning they were out of work for at least six months. This was the fifth-highest long-term unemployment rate in the country.

Likewise, 8.1 percent of New Yorkers were underemployed - a category that includes the unemployed as well as those who “have become so discouraged about their prospects for finding a job that they ceased looking and workers who would like to work full-time but can only find a part-time job,” the report said. New York's official unemployment rate for 2007 was 4.6 percent.

New claims for unemployment benefits started to rise in early 2008, reaching 20,000 each week by mid-August, the report said. During the last “economic downturn,” which lasted from 2000 through 2002, FPI noted that unemployment payments “were of critical importance in stabilizing income” throughout the state, representing “18 percent of the change in total state personal income” during that time, the report said.

Now, FPI's report says, New York's “already troubled and outdated” unemployment insurance system is under “a huge strain.” The state system offers 26 weeks of payments, supplemented by the 13-week extension passed by Congress and signed into federal law in late June. But the maximum weekly benefit of $405 has remained unchanged since 2000, representing a 25-percent decline in real value, the report said.

“The growing number of people filing for unemployment insurance is running headlong into the chronic shortcomings of the unemployment system,” Mr. Parrott said. “That's bad news for workers, who don't receive the benefits they deserve. And it's a serious concern for the state economy, which receives a well-timed stimulus from unemployment insurance payments that offsets some of the decline in local wages.”

FPI speculates that the state economy will “continue declining through the rest of 2008 and possibly into 2009,” with high unemployment remaining “a major challenge for some time” and eventual recovery likely to be “very gradual.” The report advocates as “integral” the modernization of the unemployment insurance system, and says that “substantial spending cuts that trigger job declines will worsen the downturn.”

“New York's projected budget gaps have received considerable attention in Albany,” Parrott said. “The state's growing unemployment is the other crisis to which Albany must also turn its attention.”

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