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Massachusetts unemployment rate rises to 6.7 percent

The Massachusetts unemployment rate ticked upward to 6.7 percent in December, the seventh straight month that the rate held steady or increased, state officials said Thursday.

The jobless rate has slowly risen from 6 percent since May and added a tenth of one percentage point last month. But the state also added 7,500 jobs in December and 51,000 jobs last year. That helped to trim the unemployment rate from 6.9 percent a year ago and a peak of 8.7 percent in October 2009.

Alan Clayton-Matthews, an economist at Northeastern University, said the state’s economy is experiencing slow to moderate growth “and that’s about as good as you can expect right now, considering events in Europe and the slowdown in the world.”


The national unemployment rate was 7.8 percent in December. While the state weathered the recession and its aftermath better than the nation, the state and national economies are now growing at about the same pace, said Clayton- Matthews.

Contributing to the slow growth are questions about how Congress will manage the political conflict over the nation’s borrowing limit and the threat of significant federal cutbacks in spending, unknowns that have made employers wary about hiring and investing.

It is a particular problem for Massachusetts, where research institutions and defense contractors receive a greater than average share of federal research and defense funding from Congress.

The Massachusetts economy has also been held back by weak demand from Europe and ­China.

The state’s exports to Europe during the first nine months of 2012 fell by $1.1 billion, or 13.5 percent, compared with the same period a year earlier, while exports to China dropped $177 million, or 11 percent, according to the Associated Industries of Massachusetts, the state’s largest business group.

Clayton-Matthews said the job numbers are volatile and subject to significant revisions, noting that the payroll survey of employers showed a gain of more than 50,000 jobs in Massachusetts in 2012, while the household survey, which is used to calculate the unemployment rate, showed a gain of about 25,000 jobs over the year.


The payroll survey also showed that Massachusetts employers added 7,500 jobs in December, but officials revised their November calculation downward to show a loss of 3,200 jobs.

While the report appears to show conflicting trends of rising unemployment and employer hiring, economists said that is due to how the unemployment rate is calculated. Discouraged workers who have given up looking for work are not counted in the overall unemployment rate. But when those people return to their job search — often because they feel their job prospects have brightened — they are included in the statistics, causing the unemployment rate to rise.

Sectors that showed job losses last month included the professional, scientific and business services sector, which includes lawyers, architects, and engineers. It lost 1,000 jobs over the month, but added 22,800 jobs last year.

The number of government jobs was unchanged in December, but federal, state, and local governments added a total of 900 jobs over 2012.

The sectors that gained jobs included the education and health services sector, which added 3,800 jobs last month and 7,300 over last year; leisure and hospitality, which gained 3,200 jobs and 6,300 jobs for the year; and construction, which added 1,400 jobs over the month and 300 last year.


Financial activities added 100 jobs in December, and gained 1,900 during 2012.

Manufacturing gained 800 jobs last month, but lost 1,100 over last year.

Michael Goodman, a public policy professor at the University of Massachusetts Dartmouth, said businesses could be cautious about spending and hiring because of fiscal uncertainties in the United States and globally.

He also cautioned against putting too much stock in the month-to-month calculations, noting that they are often volatile and subject to large revisions.

“Right now, the looming threat of sequestration and the debt ceiling and the ongoing challenges in Europe are the biggest strains on the Commonwealth’s economic recovery,” he said.

“Some sectors are hanging in there, and others are dealing with uncertainty and the difficulties Washington has in solving our national problems.”

Megan Woolhouse
can be reached at