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Posted April 2, 2009 | Copyright © The Northern Virginia Daily
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Unemployment hits 9.2 percent

Jobless claims in Winchester spike to levels not seen since the early '90s

By James Heffernan -- jheffernan@nvdaily.com

The top of Virginia hit 9.2 percent unemployment in February, a level not seen since the early 1990s.

The Winchester area's 1.5 percentage point jump from January was by far the largest among Virginia metro areas, and put the region within striking distance of perennial unemployment leader Danville, which saw its rate fall during the period to 12.3 percent, according to the Virginia Employment Commission.

Excluding Hampshire County, W.Va., the Winchester MSA was at 9.3 percent, its highest mark since March 1992. Area unemployment has more than doubled in the past 12 months.

The Northern Shenandoah Valley has been especially hard hit by the downturn in construction and related manufacturing as well as the automotive industry. Even the services sector, once a bright spot for the region, has been shedding jobs.

"It seems to be a lot of the same thing [in February]," VEC Chief Economist William F. Mezger said of the Winchester area. "Once it starts, it just builds on itself."

Also, since unemployment figures are based on where a person lives instead of where they work, some of the local jobless claims are the result of layoffs in Northern Virginia industries, namely construction, Mezger said.

Still another factor may be at play.

"In the whole northern part of the state, you're getting some people who had been living and working in Maryland or [Washington] D.C.," Mezger said. "Now that they're unemployed, they're coming to Virginia," which adds to the local work force and, in some cases, drives up unemployment.

The Winchester area saw about 1,000 new jobless claims between January and February, according to the VEC.

The number could have been higher, Mezger said, were it not for the strength of the local health care sector and government jobs.

Across the region, the city of Winchester had the highest unemployment in February at 10 percent, followed by Warren County (9.1 percent), Frederick County (9 percent) and Shenandoah County (8.9 percent).

Only Clarke County (6.8 percent) and Rappahannock County (6.4 percent), with their considerably smaller labor forces, kept the region's jobless rate from creeping up even more.

Patrick Barker, executive director of the Winchester-Frederick County Economic Development Commission, said the upward trend in unemployment is not that surprising given the economy.

"A few years ago, when this area was one of the fastest-growing economies in the state, a lot of our growth was services and housing industry-related," he said. "Now, because those industries are down, you somewhat expect the [jobless] numbers to rise."

But Barker stressed that unemployment is only one measure of a local economy.

"Our inquiry levels [from outside companies] are fairly stable. The phones are still ringing, e-mails are still coming in, and clients are still visiting the area. ... And there are still local companies out there that are hiring and growing."

February is traditionally one of the highest months of the year for unemployment in Virginia.

Gene Schultz, manager of the VEC office in Winchester, said he has already started to see a drop-off in the number of claims being filed this spring, and area employment should begin to pick up as construction, tourism and other seasonal activities begin in earnest.

"I'm hopeful those rates will start coming back down," he said.

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