State's unemployment rate drops in May

Missouri's unemployment rate fell slightly for the second month in a row during May, according to a new report from the Missouri Department of Economic Development.

The state's unemployment rate fell to 9.3 percent in May, down by two-tenths of a point from 9.5 percent in April. In March, Missouri's unemployment rate was 10.2.

"I think we have likely seen the worst of the recession and unemployment has peaked," said Bruce Domazlicky, director of the Small Business and Research Center at Southeast Missouri State University. "However, like at the national level, economic growth is unlikely to be fast enough to have much of an impact on unemployment so rates will only come down slowly."

Missouri's non-farm payroll employment shows 4,900 jobs were added in May, according to the DED report. The federal government added 7,300 jobs in May, including many temporary census workers. In the private sector, leisure and hospitality jobs increased by 1,000 positions.

Local companies are cautiously optimistic about the future of the economy, said Mitch Robinson, executive director of Cape Girardeau Area Magnet, a not-for-profit economic development organization.

"I've talked with several companies that seem to feel positive about their current business situation as well as the near future," said Robinson.

Individual county data for May has not yet been released, but during April, Cape Girardeau County's unemployment rate was at 6.4 percent, significantly lower than the state average.

Robinson said there is pent-up demand among local employers who have delayed hiring as they wait for economic conditions to improve.

"You don't want to hire somebody and then have to lay them off in two months," Robinson said. "Training new employees is very expensive and time consuming. [Businesses] have to make sure they are at that point where they are willing to hire."

Several local companies are currently working their current employees overtime to keep up with production demands, rather than hire new workers, he said.

In Cape Girardeau County, unemployment rates have fallen in the month of April for the past several years.

There is a strong seasonal factor that causes this, Domazlicky said.

"This is partially due to construction picking up as well as, to a lesser extent, retail sales," he said. "After Christmas, retail sales tend to flatten out for a while until spring purchasing picks up."

mmiller@semissourian.com

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