By Michael Kannell
The metro Atlanta unemployment rate rose from 5.1 percent to 5.3 percent last month as new workers entered the labor force faster than modestly-paced hiring could snap them up, the state Labor Department reported Thursday.
February is nearly always a month of job growth, and this year stuck to the script with about 7,700 jobs added.
But that was weaker than average. During the previous five Februarys, metro Atlanta gained an average of 16,100 jobs. The best February metro Atlanta ever had was 2011, when the economy added a robust 35,000 jobs.
Layoffs – measured by new claims for unemployment insurance – were well below January’s level and slightly lower than February of last year.
Overall the month was a stutter-step forward following job losses in January, and the long-term trajectory was still fairly strong. During the past year, metro Atlanta has added 72,500 jobs. That is not as strong as February-to-February growth a year earlier, but other than that year it was the best since 2006.
Mike Belote, vice president and general manager at Peak 10, which provides information infrastructure, said the company has grown to about 50 employees in Norcross and Alpharetta, about one-eighth of its total workforce. There’s no reason to think the trajectory will change, he said.
“Atlanta is growing, Atlanta is hiring,” Belote said.
Despite the higher unemployment rate, it appears more of the unemployed are finding work. About 153,000 people in the region are unemployed and searching, down 16,000 from a year ago. More strikingly, it is dramatically lower than the recession-crest of nearly 300,000 unemployed.
Metro Atlanta unemployment was 6.0 percent a year ago, the Labor Department said.
But focus on the direction of the unemployment rate can be misleading.
People who aren’t employed and have stopped looking aren’t counted in rate calculations, and that can cut the jobless rate even though their discouragement may reflect weakness in the economy. Conversely, when the economy improves and they jump back in the jobseeking pool, it can boost the rate even as hiring improves.
So it may be that the rise in the jobless rate in February is not such a bad sign.
“We are starting to see the trend reverse,” said Mark Butler, state labor commissioner. “That’s the big reason we saw the unemployment rate go up.”
The labor force grew by 20,305 in the month, but the number of unemployed people rose 5,931, the Labor Department said.
The start of the year was a time of questions for hiring at many companies, said Andy Decker, Atlanta-based senior regional president for staffing company Robert Half.
January is always a time of post-holiday layoffs in retail and a moment of reassessment for everyone else as the new year begins. But 2015 ended with the stock market diving as investors recoiled from the Federal Reserve’s hike of short-term interest rates and fretted about China’s economic woes.
Many businesses hesitated to commit to new investments and new employees, Decker said.
“I think for the first six weeks of the year, everybody took something of a precautionary stance. It felt like business held for a beat in January.”
The March report will tell the tale of whether it was a momentary slowdown. A rosier set of numbers along with stronger growth are expected, said Mekael Teshome, Southeast Economist for PNC Financial Services Group.
“The metro Atlanta economy is firing on all cylinders now.”
METRO JOBLESS RATE FOR FEBRUARY