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'The cost of taking a job has gone up': Jobless rate declines in Virginia, but labor force participation remains an issue
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'The cost of taking a job has gone up': Jobless rate declines in Virginia, but labor force participation remains an issue

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Virginia’s unemployment rate dropped in September, but the state’s labor force also dipped in an ongoing sign of the difficulties employers have in hiring people.

The state’s jobless rate was 3.8% in September, the Virginia Employment Commission reported on Friday. That was down from 4% in August and 6.6% a year ago in August. The numbers have been adjusted for seasonal factors that can temporarily affect employment.

While the number of Virginia residents counted as employed rose by 4,747 to 4,084,410 from August to September, the overall labor force also dropped by about 4,747.

The overall labor force in Virginia stood at around 4.24 million in Virginia in September, down from about 4.30 million in the same month last year.

Sonya Waddell, regional economist at the Federal Reserve Bank of Richmond, said Thursday that employment in Virginia is about 3.5% below its pre-pandemic level through September, compared to 2.2% below nationally and 1.7% below in North Carolina.

Participation in the labor force is declining in both states. In Virginia, 62.8% of the workforce is back in the job market, a historic low. More people are retiring early or not returning to work for a variety of reasons, including child care and other expenses relating to work.

“The cost of taking a job has gone up,” Waddell said.

Renee Haltom, vice president and regional executive at the Federal Reserve, said employers “just see their workforce reassessing life.”

“The shortage in jobs is more about a shortage in labor supply than it is about labor demand being strong,” Haltom said.

Virginia’s seasonally adjusted unemployment rate in September continued to be below the national rate, which fell from 5.2% to 4.8%.

Compared to a year ago in September, nine of the 11 major industry sectors tracked by the government in Virginia had job increases. The largest over-the-year gain was in professional and business services, which added 23,800 jobs.

The leisure and hospitality sector, which had the most significant losses during the pandemic, had a gain of about 19,300 jobs from September 2020 to September 2021, up almost 6%. But employment in that industry still remains the furthest from the pre-pandemic level — still down just over 18% as of September.

The finance industry had the largest job loss over-the-year, declining by 5,700 jobs, or about 2.7%.

September rates for local areas in Virginia are expected to be released on Nov. 3.

jblackwell@timesdispatch.com

(804) 775-8123

Staff writer Michael Martz contributed to this report.

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