By Erin Wade
BU News Service
The unemployment rate in Massachusetts dipped below 3 percent last month, its lowest level since January 2001, the Executive Office of Labor and Workforce Development announced last week.
Massachusetts has seen the largest decline in unemployment rates among the 50 states over the year, according to the Bureau of Labor Statistics. Now at 2.9 percent, the state’s jobless rate has dropped for the last five months and is down 2 percent over the year, from 4.9 percent in November 2015.
“We are very pleased to see the unemployment rate consistently go down month after month,” Ronald L. Walker II, secretary of Labor and Workforce Development, said in a statement. “Not only is the unemployment rate declining, but we have continued job growth in key sectors that drive the Massachusetts economy.”
Massachusetts’ jobless rate for November was about 1.7 percent below the national average of 4.6 percent, though it was close to the national average of 5.0 percent this time last year, according to the Bureau of Labor Statistics.
Kevin Lang, a labor economist and professor at Boston University, said it’s uncertain when Massachusetts’ unemployment numbers will bottom out. “There is a point beyond which we are unlikely to go, but it is an open question as to how close we are to that level,” Lang said in an email.
The number of jobs in the state has increased by 67,200 in the last 12 months, with an estimated 5,800 jobs added in November and 5,400 lost in October, according to the Executive Office of Labor and Workforce Development.
“Massachusetts benefits from a highly-educated workforce,” Lang said. “The medical field, which is an important industry for the state, is also doing well.”
Over the year, education and health services has added 23,700 jobs, the most of any sector in the state labor market.
Some of the questions we should be asking about unemployment is the balance of the trust fund. It is great that UI rate is low, however, due to last years revamping of unemployment rates, the UI trust fund is not building up reserves for the next recession (keep in mind these occur every 8-10 years). So when the economy does start to dip, and UI rises there will not be enough reserves in the trust fund to maintain and sustained downturn. This will cause an emergency issuance by DUA for businesses to pay additional UI (in the middle any quarter) which will put an additional strain on businesses during a down turn. This, added with the fact, the DUA is not fixing their system turn this quiet time, and have in fact cut their fraud department (both on the claimant and business side) down to its bare bones. Enjoy these UI articles now, because when it goes south it is going to be a wild ride.