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Pink slips pile up in Florida

Michigan may have trounced Florida in football this year, but we just slammed our Rust Belt rivals in a category where they have long held prominence: job losses.

For April, Florida led the nation for the largest month-over-month drop in employment levels. From March to April, the state lost 25,300 jobs. Michigan, meanwhile, shed 18,600 positions over the month.

"It's certainly not a position we're used to,'' said Rebecca Rust, economist with Florida's Agency for Workforce Innovation. "We've been a leader in job creation for most of the last decade because of the construction boom, which was exacerbated by hurricane recovery. When you're up so high, you have farther to fall."

Florida's dubious honor emerged from state and federal employment reports issued Friday. They showed that while the unemployment rate remained level in Florida from March to April, at 4.9 percent, that's only part of the story. Month-over-month job loss is another indicator of a state economy's health or lack thereof.

In retrospect, signs of trouble had been brewing for a while: Florida actually had the highest number of month-over-month job losses five times since January 2007. But those deficiencies were often not immediately visible because of the sampling method of employers used to derive the monthly figures.

A spokesman for the state's jobs agency said year-over-year comparisons are considered more accurate. But there, too, Florida's showing was poor in April, with a net loss of 64,500 positions since April 2007. Michigan, with its long-suffering auto industry, fared worse by this metric, losing 72,100 for the year. In Florida, the biggest contributor to the job drain was the construction sector, responsible for 63 percent of the loss.

Mark Vitner, an economist with Wachovia, said the results shouldn't come as any surprise.

"Florida has seen the bottom come out of the housing industry and that sums up all the job losses," he said. "I do think construction will bottom out in 2008, but we won't see housing return to strength until 2011 or 2012."

Though fallout from the real estate bust affected employment levels statewide, the Orlando area still managed to net gains over the past year, adding 6,200 jobs, many in the still-growing leisure and hospitality sector. The Tampa Bay area, meanwhile, lost 13,800 jobs for the year. Unemployment in the bay area was 4.9 percent in April, down slightly from 5.1 percent in March, but well above the year-ago level of 3.6.

After six years of running below U.S. averages, Florida and the Tampa Bay area's jobless rates nearly caught up with the national average of 5 percent in April. Sean Snaith, an economist with the University of Central Florida, said the convergence of rates was expected.

"I think we'll continue to see job losses through the summer," he said. "And unemployment will drift slowly higher through 2008."

Snaith predicted Florida's rebound will be hampered by the chill in the credit markets.

But he and other economists said it wasn't helpful to get hung up on Florida's sudden appearance in the loser's column with Michigan.

"There are some real structural problems affecting that state and they've been in dire straits much longer," Snaith said of Michigan, where unemployment is 6.9 percent. "Our problems are more a cyclical function of the insane real estate market we've been in. Once we get out of 2008, things will start to brighten."

Pink slips pile up in Florida 05/16/08 [Last modified: Friday, March 27, 2009 11:45am]
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