State Jan. jobless rate highest since 1987

Published 7:31 am Wednesday, March 11, 2009

MONTGOMERY — Alabama’s January unemployment rate soared to 7.8 percent, the highest figure in more than 21 years.

Alabama last hit 7.8 percent in May 1987.

And Ahmad Ijaz, an economic researcher at the University of Alabama, predicts Alabama hasn’t seen the worst in unemployment.

“I think it will get even higher in the second quarter of the year,” he said Tuesday.

His prediction for the possible peak: 8.5 percent.

Ijaz talked about Alabama’s economy after State Industrial Relations Director Tom Surtees announced Tuesday that Alabama’s unemployment rate had jumped to 7.8 percent in January from December’s revised rate of 6.5 percent. The January 2009 rate was double the state’s jobless figure a year ago.

The number of jobless in January grew by 40,700 and pushed the total number of Alabama residents out of work to 167,774, Surtees said.

Alabama’s rate compared to a national rate of 7.6 percent. It marked the first time since May 2001 that Alabama’s rate has been higher than the national rate.

“The important thing to realize right now is that the recession has hit the entire country hard,” Surtees said.

He said Alabama’s rate remains better than its neighbors, with Mississippi reporting 8.7 percent, while Georgia, Florida and Tennessee posted 8.6 percent.

Ijaz, who works for Alabama’s Center for Business and Economic Research, said the state’s unemployment figures don’t count people employed by businesses that have cut workers from full-time to part-time or people who would like full-time work but can only find part-time jobs.

If those were counted, Alabama’s rate would be 12 percent to 13 percent, Ijaz said.

Ijaz said improvement in the unemployment rate will come after the economy starts recovering because employers usually don’t start hiring until they feel confident about the economy. He predicts that could happen in the second half of the year.

In January, 30 of Alabama’s 67 counties had unemployment rates in double digits.

The highest figures were Wilcox County at 19.5 percent, Chambers County at 17.9 and Dallas County at 17.3 percent. The counties with the lowest unemployment rates were Shelby County with 5.5 percent, Madison County at 5.7 percent, and Coffee County at 6.2 percent.