Carolinas unemployment leaps

Unemployment in North Carolina last month rose to its highest level in more than four years, as the cooling economy continued to take a toll.

The jobless rate jumped to 5.8 percent last month from 5.4percent in April, according to statistics released Friday by the N.C. Employment Security Commission. That was the highest since February 2004.

The number of people employed in the state dropped by more than 18,000.

In South Carolina, the jobless rate rose to 6.5 percent in May, its highest level in more than two years. Only five states and the District of Columbia had higher unemployment rates in the U.S. last month.

Part of the change could have been a fluke. More teenagers and college students entered the work force for summer jobs. At the same time, government employment dropped by 5,100 jobs in North Carolina, likely reflecting the end of the school year.

“Looking at the data, it looks a little fishy,” said Mark Vitner an economist with Wachovia in Charlotte. Still, “there's no doubt the unemployment rate is rising because overall job growth has slowed.”

Nationally, joblessness in May had the biggest one-month jump in two decades, with the unemployment rate climbing to 5.5 percent from 5percent in April. Every state except one, Louisiana, had an increase in joblessness.

Unemployment in North Carolina has risen for five consecutive months and exceeded the national average for four of them.

The state is still attracting new jobs – Reliance Industries on Friday, for instance, said that it would create 204 jobs in Kinston.

What's more, personal income in the state grew .9percent in the first quarter, less than the U.S. average 1.1percent but better than 20 other states.

“While there is some good news out there, it's probably not enough to overcome this wicked trifecta of soaring energy costs, the credit crunch and the housing slump,” Vitner said. And there might be some cause for concern.

Vitner had projected North Carolina's unemployment rate would rise to 6 percent this year. If May's increase in the unemployment rate doesn't prove to be a bit of a fluke, that might indicate the slowdown could cut deeper.

In South Carolina, jobs were added in all parts of the economy except manufacturing, education and construction. The state has now lost construction jobs seven months in a row.

The state actually added 7,800 jobs in May. But nearly twice as many people reported they could not get one, leading to the steep increase, officials said.

One of those people is Maria Calef. The 62-year-old teaching assistant said she can't afford to stay out of work this summer because she is taking care of her mother and granddaughter.

“Everything is so much more expensive. You have to figure higher prices into everything you do. I can't afford to be out of work long,” said Calef, who came to the Employment Security Commission's Columbia office Friday to look for a job.