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Pennsylvania jobless rate rose in August to 7.7 percent

| Friday, Sept. 20, 2013, 11:55 a.m.

The state unemployment rate increased to 7.7 percent in August, the first time the jobless rate had increased since January, despite a gain of 11,300 jobs that signaled employers are continuing to hire.

Economists called the data released Friday from the U.S. Bureau of Labor Statistics a mixed report that did not foreshadow a downturn in the state's economy.

The negative side of the report was drawn from the bureau's resident survey. Those who said they were working fell by 26,000 last month to about 6 million, while those who said they were unemployed rose by 9,000 to 501,000.

As a result, the jobless rate rose to 7.7 percent from 7.5 percent in July but was healthier than the 8.1 percent rate in August 2012.

But the household survey tends to be “more volatile” than the survey of employers, who said they hired 11,300 people in July, said Gus Faucher, senior economist at PNC Financial Services Group.

“So it could be this will reverse in September,” he said. “I expect that the unemployment rate will gradually decline over the next couple of years.”

The increase in the state's jobless rate contrasted with the country's unemployment rate, which declined to 7.3 percent in August from 7.4 percent in July.

In the seven-county Pittsburgh region, unemployment was 6.7 percent in July, as the region added 3,300 jobs, according to the latest data. The jobless rate for the region has been lower than the state and national rates all year.

Mark Price, a labor economist for the Keystone Research Center in Harrisburg, said the August report was probably a “temporary hiccup.” The number of unemployed state residents fell significantly most months this year but rose in August, which Price called “an aberration.”

“I wouldn't be surprised if a decline in unemployment returned,” Price said. “There's no reason to think the economy is not going to grow in Pennsylvania in the months ahead.”

The 11,300 new jobs in August, which Price called a “very healthy” gain, mainly centered in service industries, such as leisure and hospitality and trade, transportation and utilities. It included 1,800 new jobs in construction and 2,100 government jobs. Manufacturing lost 200 jobs, and mining and logging lost 1,000 jobs.

The size of Pennsylvania's labor force — those either working or actively looking for a job — declined by 17,000 to about 6.5 million. The decline generally indicates unemployed people lack confidence they could find work.

When people stop looking for a job, they are no longer counted as part of the labor force, which artificially lowers the unemployment rate.

Thomas Olson is a Trib Total Media staff writer. He can be reached at 412-320-7854 or at tolson@tribweb.com.

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