Unemployment woes hit hard in New England
Tashon Brown says she had no idea she was in danger of losing her job when she arrived for work one day last December — until a security guard told her she no longer had permission to enter.
The insurance specialist became one of 16,800 Massachusetts residents to lose their jobs in 2008’s final month, sending the state’s unemployment rate to its highest level in more than 15 years.
Experts say many factors are contributing to the spike and agree Massachusetts is finally catching up to other states that have been feeling the effects of the national recession, losing jobs in sectors that had not previously taken such a bad hit.
The professional and business services sector, for example, lost 7,500 jobs, accounting for almost half of December job losses.
“No one said anything,” said Brown, a 28-year-old Jamaica native who had two stints as a contractor at John Hancock, the most recent lasting about two years. “I called my boss and he was like, ‘Oh yeah, we’re currently overstaffed and we have to let people go.’ And that was it.”
John Hancock issued a statement saying contract employees are informed of the change in status by either their manager or their agency and officials were “very concerned” about what happened in Brown’s situation.
The Executive Office of Labor and Workforce reported Jan. 22 that December’s unemployment rate was 6.9 percent, a full percentage point above November’s rate of 5.9 percent. The Massachusetts jobless rate has been consistently below the national level, but December’s numbers brought the state closer to the national rate of 7.2 percent.
The last time unemployment in Massachusetts was 6.9 percent was in October 1993.
“Before the last two months we had really been feeling a recession, but not as much as other states. It’s clear now it’s hitting us very hard,” said Jim Klocke, executive vice president at the Greater Boston Chamber of Commerce. “We’ve lost jobs in just about every sector.”
Those other sectors are following so-called “frontline industries,” such as construction, manufacturing and financial services into job losses, said Robb Smith, director of policy and planning at the Executive Office of Labor and Workforce Development.
The Massachusetts workforce had been mostly insulated from the national recession before December due to its diverse economy, said David Tuerck, executive director at the free-market think tank Beacon Hill Institute.
“We certainly will have a contraction and are having one, but it will be shallower and shorter than [the] rest of United States,” Tuerck said. “Our economy is quite strong compared to other states because of our high-tech industry, the vibrancy of the financial sector and the quality of labor force.”
Some neighboring states are faring worse when it comes to joblessness. Rhode Island’s unemployment rate was the worst in the country, reaching 10 percent in December. Maine and Connecticut had rates of 7 percent and 7.1 percent, respectively. It was Maine’s highest rate since June 1992.
Vermont, with a rate of 6.4 percent, and New Hampshire, at 4.6 percent, both fared better than Massachusetts.
Jerry Rubin, president and CEO of Jewish Vocational Services, a Boston career center that serves all populations, said professional and business services likely took a hit because businesses cut outsourced services, such as consulting and temporary workers.
The labor office reported more than half of the monthly jobs lost for professional and business services were in administration and support, which includes temporary help like Brown.
“Companies look to protect their core internal capacity and reduce the number of layoffs for the company, so they eliminate outside services,” Rubin said. “All [the] business consulting and operational consulting and HR consulting tends to go quickly as companies retrench and try to protect their own internal operations.”
Rubin also said his professional job seeker service, which is privately funded, was up 40 percent in September through December over that period in 2007.
Brown receives career counseling from a job center called The Work Place, which is run by the City of Boston and Jewish Vocational Services.
Now that she no longer has a full-time job, Brown is doing the same things as a growing number of other Massachusetts residents: waiting for her unemployment check as the agency faces growing delays with the high number of claims; getting a part-time job in a hotel restaurant that doesn’t cover her $1,000 monthly rent and $1,500 a month in student loans; and going back to school for medical assistance, hoping to find employment on the other side.
“All my bills are backed up — I mean really backed up,” Brown said. “It’s so depressing.”