Connecticut’s jobless rate jumped an astounding 4 ticks to 8.5 percent in July, even as employers added 5,100 jobs, an impossibly odd pairing of data.
Is it good news or bad news? The two figures are based on two different surveys, and the 5,100 jobs gained puts Connecticut on track for a decent year, with 9,700 added positions so far in 2012.
But it’s hard to put a happy face on an unemployment rate that has now leaped ahead of the national rate of 8.3 percent — especially since the state’s rate has now climbed for three straight months, from a post-recession low of 7.7 percent in April.
After the state Department of Labor reported the numbers, the agency took the extraordinary step of holding a conference call with research director Andy Condon to explain the basic fact — both things didn’t happen.
The issue is that the job-creation data is based on a survey of about 6,000 employers, while the unemployment rate is based on a larger survey of households.
It often happens that the household survey shows a rise in the number of people working, but also a rise in the number of people not working. In that case, the unemployment rate can rise even as companies hire, as people flood into the work force.
But in Thursday’s report, the number of people who say they’re working is down by a whopping 15,000, even as employers added more than 5,000 positions.
It’s possible that employers in other states, chiefly New York, have eliminated the jobs of Connecticut residents. It’s also possible that a large number of people who had been self-employed and thus not part of the workplace survey — are now reporting that they’re not working.
But there’s no evidence that those trends are happening, so the best explanation, Condon said, is simply a discrepancy in the surveys both of which are known to be way off on any given month.
“We’re left with little else to look at based on the differences between these two,” Condon said. “Sometimes you don’t get the right answer and you have to wait until you do get the right answer.”
Gov. Dannel P. Malloy issued a statement immediately, saying he believes the household survey is wrong.
“To buy into the household survey number you’d have to believe that Connecticut lost 503 jobs every day during the month of July, and there’s just no evidence to suggest that happened. Unemployment claims have drifted upward, but not at a rate that justifies the household survey number.”
Italics were Malloy’s. And he lost little time making the point that he’s working as hard as he can, as evidenced by the fact that his deal with Bridgewater Associates Wednesday promises to add 1,200 high-paying jobs.
Connecticut, like the rest of the nation, has seen job gains generally stagnate in 2012 after a promising 2011. The state’s unemployment rate fell from 8.9 percent to 8 percent in the last six months of 2011, then fell to 7.7 percent in March before rising again.
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