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Joblessness in our Area Well Below U.S. Rate

Buffalo Niagara Ranked 110 out of 372

By David Robinson
August 31, 2011

Unemployment may be stubbornly high in the Buffalo Niagara region, but it's worse in most other U.S. cities.

The Buffalo Niagara region's 7.7 percent jobless rate ranks in the top third for the lowest jobless levels among the nation's metro areas, a new federal report said Wednesday.

The Buffalo Niagara region ranked 110th among the 372 biggest metro areas in the United States during July, according to data from the U.S. Bureau of Labor Statistics. The local jobless rate, which was unchanged from June, was well below the U.S. seasonally unadjusted unemployment rate of 9.3 percent.

Unemployment locally has dropped by almost a full percentage point over the last two years as the pace of job growth has picked up. The region added jobs at a nearly 2 percent annual pace during July, which was the second-fastest growth rate among the state's 13 biggest metro areas, the state Labor Department reported.

Growth in the private sector, which excludes government jobs, also has been accelerating, reaching an annual growth rate of 1.8 percent in July, the Labor Department said.

One of the reasons unemployment in the Buffalo Niagara region is lower than the national average is that jobless levels never spiked as high as they did across the country during the height of the recession, peaking at 9.6 percent in January 2010.

Federal Reserve Bank of New York economists, in a report this week, noted a link between metro areas like Buffalo, which had less-severe jumps in unemployment, and the stability of the local housing market.

The economists, Jaison R. Abel and Richard Deitz, who are based in Buffalo, found that metro areas experiencing the worst spikes in unemployment during the Great Recession frequently were the regions that also endured the widest boom-to-bust cycle in their local housing market. A big reason for that was that the regions with stable housing prices did not experience the large decline in construction jobs that the boom areas did.

"It turns out that the severity of the local housing cycle is closely tied to local job growth during the expansion and recession," the economists wrote.

During the downturn, Western New York lost 2.7 percent of its private-sector jobs, which was less than half of the 5.9 percent decline nationally, according to a report issued Wednesday by the Rockefeller Institute, an Albany think tank.

Even so, unemployment in the Buffalo Niagara region is still relatively high by upstate standards. Jobless levels are lower in Albany (7 percent), Rochester (7.5 percent) and Utica (7.5 percent), but higher in Syracuse (7.8 percent) and Binghamton (8 percent).

Nationally, unemployment rates fell in most U.S. cities during July, despite a weak economy that is producing few jobs.

Unemployment rates dropped in 193 large metro areas, increased in 118 and were flat in 61. That's a sharp change from June, when unemployment rates rose in more than 90 percent of metro areas.

Bismarck, N.D., had the nation's lowest rate, at 3 percent. It was followed by Fargo, N.D., at 3.7 percent, and Lincoln, Neb., at 3.8 percent.

drobinson@buffnews.com