Locals fear jobless rate hike

Wednesday, Nov. 5, 2008

Their employer, Linens ‘n' Things in Waldorf, is going out of business and they're scared the rough economy means they won't find another job in time, adding them to growing unemployment rolls before too long.

"It's stressful. I had heard Linens ‘n' Things was closing but I heard this one wouldn't be going out of business," Porter, who began working there four months ago, said. The move was unexpected and on a recent weekday, she was busy marking down merchandise. She's started looking for other jobs but said it was hard enough to find the one she has.

The national chain is closing the last 371 underperforming stores with about 10,000 employees, according to a Linens ‘n' Things spokesman. The company filed for Chapter 11 bankruptcy protection in the spring but had to liquidate when a potential sale of the company fell through this month. About 25 jobs will be lost at the Waldorf store.

"Hopefully, I will [find another job]. If I don't, I don't know what I'm going to do," she said.

"I'm worried about it," Linder said.

Porter and Linder aren't alone.

Southern Maryland's jobless rate hit 3.8 percent in September up from 2.8 percent last year, from 3.1 percent in January, but down from 4 percent in August, according to recently released statistics from the Maryland Department of Labor, Licensing and Regulation.

Maryland's jobless rate creeped to 4.6 percent in September — below the nationwide average of 6.1 percent but up from 4.5 percent in August, 3.4 percent in September 2007 and 3.9 percent in January.

Despite continual increases, Maryland Assistant Secretary for Workforce Development Andy Moser said the state is in pretty good shape, thanks to plenty of government jobs.

"Between 4 and 5 percent is considered to be full employment," he said.

"The growth in unemployment slowed in September despite continued turmoil in the national economic climate. Our situation remains better than that of the nation, as evidenced by our year over year job growth, but the crisis in housing and the financial markets has taken its toll," Maryland Department of Labor, Licensing and Regulation Secretary Thomas E. Perez said in a statement.

About 29,000 jobs have been added to Maryland's market since last September, according to the DLLR. Maryland ranks 13th in the nation of lowest unemployment rates, said Anirban Basu, economist with the Sage Policy Group in Baltimore. Charles and St. Mary's are tied for seventh highest jobless rate by county in the state.

The states with the lowest rates include South and North Dakota, Wyoming, Utah and Oklahoma. The highest jobless rates include Michigan, Rhode Island and California.

"We've definitely been seeing more people coming in for services," said Jonathan Toye, interim workforce investment administrator for the Southern Maryland Workforce Services Center in Waldorf. The center offers resume writing and interviewing training, veterans' services and help snagging federal employment.

Despite employment being hard to find in retail and service sectors, which have been hit hard by low consumer confidence and stock market woes, Toye said he doesn't believe Charles County has been as drastically affected as other places around the country. Over the past few months, Toye said he's only heard of Bennigan's restaurant on U.S. 301 having closed and that Starbucks planned to close its St. Charles Towne Center location for underperformance.

The three Southern Maryland workforce centers in Waldorf, Leonardtown and Prince Frederick saw a 38.5-percent increase in the number of customers seeking services in fiscal 2007 from fiscal 2006, from 19,906 to 27,582. Toye said Fiscal 2008 numbers haven't yet been calculated but he expects to see an even greater increase.

Over the next couple of weeks the center will be conducting outreach for about 25 employees of Waldorf's Linens ‘n' Things, Toye said. Jobs may be difficult to come by, but some employers are still using the center and advertising through it because it's free, particularly seasonal companies such as FedEx.

"They definitely are looking. They're using our services more because they're free," he said.

But the labor market continued to tighten in September, as evidenced by the number of jobseekers who opted to discontinue their search — a movement countering the trend of prior years. The number of jobs on Maryland's business payrolls fell by an estimated 1,000 jobs, a decline prompted primarily by reductions in the public sector and by further cuts in the manufacturing and construction industries.

"Thus far, year to date, [unemployment insurance] claims are up 24 percent versus the same time last year, said Maryland Department of Labor, Licensing and Regulation Assistant Secretary for Unemployment Insurance Tom Wendel. "For the last 10 weeks, they're up 40 percent. In addition to the normal type of applications, we had to implement the emergency unemployment insurance passed by Congress in July. We had 20,000 claims for extension."

The emergency insurance means someone who's exhausted the maximum payments of 26 weeks can apply for an additional 13 weeks. Over the past two and a half months, DLLR employees have worked overtime to pay out about $16 million in such funds.

The total amount of funds Wendel expects to be paid out this calendar year is about $575 million but with emergency funds it could reach $700 million. About $507 million was paid out in fiscal 2008, and $403 million in fiscal 2007.

Luckily, the state's trust fund, from which it gets unemployment insurance money, is sound, Wendel said.

"We're averaging about 950 additional new claims each week compared to 2007," Wendel said. "We're busy and unfortunately, business is good for us. You tend to follow national trends but to a lesser extent in Maryland because you tend to be isolated by all the federal employment. It's never pleasant. You get used to handling the large increases in workload that comes now and again. This is a normal cycle that grows every seven to eight years. We work hard to get the benefits out as quickly as possible."

Wendel said many of the jobs being shed include construction and some financial and travel industry shakeout as well.  Health services and government employment are growing.

Basu said that while about 519,000 Americans are without jobs nationwide, it's a work force of over 100 million, which isn't all that bad. But for smaller communities, job loss can mean devastating effects.

"In the Great Depression, government was 3 percent of the economy. Now it's 20 percent of the economy, probably more in Southern Maryland. That's a great stabilizing force," he said.

kkulp@somdnews.com

SOURCE: Maryland Department of Labor,

Licensing and Regulation