The Charlottesville area reported its highest unemployment rate in the past six years, 4.1 percent, in figures released Tuesday.
This statistic represents the unemployment rate in mid-August for Charlottesville’s metropolitan statistical area, which includes the city and the surrounding counties of Albemarle, Greene, Fluvanna and Nelson. One year earlier, in August 2007, the unemployment rate was 2.7 percent.
As is standard for figures of unemployment rates, the statistics reflect the number of people who have not found a job despite actively searching for one.
“When you go out contacting employers, sending out resumes, that is considered actively looking for work,” said William Mezger, chief economist at the Virginia Employment Commission.
Total employment in the area this August was 99,700 as opposed to 99,800 the previous year, Mezger said, noting, though, that such figures may be flawed. The statistics for total employment do not necessarily reflect a decrease in total employment in the area, Mezger explained.
“August is the lowest month [for employment] in both the University and other school systems,” Mezger said, noting that the University is the largest employer of Charlottesville area residents.
Because the University, including the Health System, employs about one-fifth of the area’s labor force, such a seasonal fluctuation would likely have a noticeable effect on total employment statistics, Mezger said.
Mezger also noted the importance of the timing of the report. Because the data were collected from Aug. 10 to 16, they do not reflect the most recent crises in the financial sector.
“They probably reflect what was going on at the time: the decline in the real-estate market, the decline in vehicle sales, and the general poor economic conditions,” Mezger said, noting that in the spring, Charlottesville was one of the fastest growing metropolitan areas in terms of total employment.
Chris Engel, assistant director of the Charlottesville Office of Economic Development, said there have been no large-scale layoffs of employees in the City of Charlottesville and noted that much of the growth in unemployment rate can be attributed to the increasing reluctance of employers to hire new workers.
Mezger noted that some industries could have a disproportionate influence on unemployment figures.
“Since the Charlottesville area supports construction workers [working in] other parts of the state, probably some of the increase in unemployment is caused by construction workers [returning to] the Charlottesville area,” Mezger said.
According to Susan Carkeek, the University’s chief human resource officer, the University has not historically laid off a large number of workers in any of its departments.
“We’ve said that that’s not the way we balance our budgets,” Carkeek remarked. “We try to manage more proactively so we do not end up in that situation.”
Like other employers in the region, the University has responded to tighter budget conditions by not filling as many of the vacancies that are left over from its high rate of labor turnover.
Carkeek also noted the complex nature of University funding creates some difficulties in providing new opportunities.
“Not all of our funds can be moved around, so we have to honor the source of the funds for many of the positions that are targeted specifically to a particular purpose,” Carkeek said.
Though the current conditions in Charlottesville may seem concerning, Engel stressed the importance of keeping the situation in perspective.
“It wasn’t too many years ago that having a 5-percent unemployment rate was considered full employment and actually quite healthy,” Engel said. “The unemployment rate within the past several years has been within the 2-percent range, which is very, very low.”
The current unemployment rate in Charlottesville remains among the lowest of any metropolitan area in Virginia, second only to Northern Virginia.
The current situation also allows for hope that there may be growth in certain sectors, Engel noted, adding that whether those hopes will materialize, though, is far from certain.
“It’s something we need to pay attention to,” Engel said of the area’s employment figures, “but it’s not something we need to be overly concerned about at this point in time.”
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