Oregon's job losses creep up in July

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The creeping tide of job losses that began in February showed no sign of slackening -- or accelerating -- in July. Figures released Monday showed that Oregon lost another 3,600 jobs on a seasonally adjusted basis and saw its unemployment rate jump a half percentage point to 6 percent.

Three major industries -- construction, manufacturing, and educational and health services -- posted big seasonally adjusted job losses in July. Taken alone, they collectively erased nearly 5,000 jobs. The loss was partially offset by gains in the professional and business services sector.

July's decline was the fourth in the past five months. Since February's peak, payroll employment in the state has dropped by 11,300 to 1.731 million. About 114,000 Oregonians are unemployed, an increase of 13,400 from a year earlier.

At 6 percent, the state's seasonally adjusted unemployment rate has now risen by a full percentage point since it reached its recent low of 5.0 percent in February through April 2007. Nationwide, the seasonally adjusted unemployment rate increased from 5.5 percent in June to 5.7 percent in July.

"We are faring about the same as the nation," said Art Ayre, a state employment economist. "We're pretty much in lockstep on the downturn."

Gov. Ted Kulongoski issued a news release on July's employment numbers that blamed rising fuel prices, increasing costs of health care, and instability in the housing market at both the national and state levels. "Today's state job statistics serve as a reminder that we are not insulated from national economic trends," Kulongoski said.

Indeed, Oregon's construction, financial-services and wood-products sectors have all been sideswiped by the housing downturn. And although conventional wisdom holds that Oregon's housing market has mostly escaped the crisis visited on other states, construction employment has declined by 10,000 jobs, or 9.1 percent, since July 2007. That's proportionately worse than in the nation as a whole, and Ayre said the sector's losses may continue as a series of big construction projects in the Portland area are completed and those workers hit the streets looking for work.

If there was a bright spot in the construction sector's July numbers, it was building equipment contractors, which added 1,500 jobs in July. Ayre said the number may be a sign of the relative strength in commercial construction projects.

Steve Zika, chief executive of the Portland-based wood products company Hampton Affiliates, said his industry has likely seen the worst of the downturn. Most sawmills have adjusted shifts and cut back hours, so he's cautiously optimistic that the sector won't see major job losses this winter, when activity typically slows.

"The next big chance for a rebound is next spring," Zika said. "People have their fingers crossed."

Oregon's high-tech manufacturing sector never really recovered from the 2001-2002 recession, when it lost 26 percent of its employment base. But it has fared well so far in this downturn, holding employment losses to a minimum.

July's figures, however, don't include the closure of Hynix Semiconductor's manufacturing plant in Eugene. The company announced the closure in late July, spelling the loss of some 1,400 company and contractor jobs over the next two months. Another tech mainstay in the state, Hewlett-Packard Co., is expected to announce job cuts of up to 300 in coming weeks.

The only big sector of Oregon's economy that posted major job gains in July was professional and business services, which added 2,200 jobs. Strength within that sector, however, was driven by administrative and building support services, which tend to be lower-wage jobs.

Kulongoski said Oregon's economic-development agenda, emphasizing sustainable industries and investments in infrastructure, is on the right track. He called on Congress to pass a meaningful economic stimulus package when it reconvenes in September, including investments in public works, a reauthorization of the forest-payments program, and a renewal of the federal energy tax credits that Oregon and other states have used to attract renewable energy companies and jobs.

Ted Sickinger: 503-221-8505, tedsickinger@news.oregonian.com