Oregon jobless rate spikes to 7.3 percent

SALEM, Ore. (AP) _ Oregon's unemployment rate rose sharply last month with major industries shedding more than 14,000 jobs as the nation's financial woes deepened.

Oregon's seasonally adjusted jobless rate jumped from 6.4 percent in September to 7.3 percent last month. That is the state's highest jobless rate since August 2004, and it's well above the national average of 6.5 percent.

"We've seen the unemployment rate drifting up this year. October was an intensification of that trend," said Art Ayre, a state employment economist.

Last month's unemployment rate translated to 134,096 Oregonians on the jobless rolls — an increase of more than 40,000 over this time a year ago.

The job losses were spread across most major industries, the Oregon Employment Department said Monday in its monthly report:

• Manufacturing cut 5,000 jobs at a time of year when a loss of only 500 is expected.
• Transportation equipment manufacturing cut 1,500 jobs.
• Computer and electronic product manufacturing cut 1,200 jobs and is down 3,100 jobs since October 2007.
• In a key sector, construction employment shrank again in October, dropping 2,000 for the month, more than double the typical seasonal decline of 900.

Construction employment has been on a steady decline since July 2007, when employment stood at 105,800. Since then, construction is down 13,900 jobs or 13.1 percent.

The state's widespread job losses have retailers bracing for a lackluster holiday shopping season that could result in reduced hiring of part-time workers at stores and malls, said Ayre, the employment economist.

In recent years it's been common for retailers to add a net 10,000 workers statewide from September through December, he said, "but this year it's likely to be lower, possibly around 5,000."

The state's political leaders are watching employment trends, too, for further signs of a worsening economy that could result in a continuing drop in tax revenue to fund state services and programs. The state's new quarterly revenue forecast is due out Wednesday.

"It is critical the Legislature do all it can to protect the human services safety net on which more Oregonians will need to depend — things like food stamps, aid to needy families and health care for children," Senate President Peter Courtney said after Monday's jobs report.

Despite tax breaks and other incentives aimed at attracting wind and solar manufacturers to Oregon, the growth in that sector has not been enough to offset the loss of other manufacturing jobs.

Still, Democratic Gov. Ted Kulongoski said Monday's jobless figures are a "call to action" for the state to keep investing in renewable energy and other sectors that can create jobs for the future.

He again called on lawmakers to approve his $1 billion transportation package, which includes a 2-cent-a-gallon gas tax increase, to help pay for road and bridge improvements and create thousands of family wage jobs.

The public works issue is likely to spark heated debate in 2009 Legislature, however. House Republican Leader Bruce Hanna, noting the big jump in the jobless rate, warned that "reckless pork barrel spending alone will not fix Oregon's economic crisis."