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Spokane, Washington  Est. May 19, 1883

States gain new jobs

Washington’s net job increase is fourth highest; California’s first

Kevin G. Hall McClatchy

WASHINGTON – Thirty-one states and the District of Columbia posted net gains in employment in January, the Labor Department reported Wednesday, providing further evidence that the economy is slowly gaining momentum.

The state-by-state January employment report from the Bureau of Labor Statistics clarifies and deepens the national employment data released last week, which suggested that employers have stopped firing workers and are starting to hire.

In January, the BLS said, California led all states in employment growth with 32,000 net new jobs. Illinois and New York state followed with respective net gains of 26,000 and 25,500, and the state of Washington followed with 18,900. Eighteen states saw employment decrease, and one state saw no change.

“The fact that you have three important and largely service-based economies showing gains may tell us that we have a broader recovery emerging, and this may be a bit of a bright light here,” said Steve Cochrane, a managing director at forecaster Moody’s Economy.com in West Chester, Pa.

States with big manufacturing operations showed positive signs last year, he said, thanks to demand created by the government’s “cash for clunkers” program and growing exports. So improvement in states with large service sectors is another positive indicator.

“Through the end of last year, most of the recovery was centered around the manufacturing centers or commodity-producing areas such as the Plains states and Texas, and increasingly towards the Southeast,” Cochrane said.

Moody’s Economy.com does its own state-by-state economic analysis, and it recently concluded that at the end of last year, 20 states had emerged from recession. Economists overwhelmingly think that the national recession has ended, but the formal declaration of that comes months later from the National Bureau of Economic Research.

Thirty states and the nation’s capital reported an uptick in their jobless rates. The unemployment rate is rising in many states because workers who gave up and exited the labor force are seeking employment again as the economy resumes growing. That means there’s greater confidence that the economy is rebounding, but it also suggests that the national jobless rate could rise again.

“While there has been a sharp narrowing in the breadth of unemployment rate increases, unemployment rates through January continued to rise in more states than they fell. Historically, a predominance of declining state unemployment rates confirms the staying power of a downward trend in the national rate,” Alan Levenson, the chief economist for investment manager T. Rowe Price Associates, wrote in a note to investors.

The most positive news in Wednesday’s report was the indication of new hiring in large, economically important states.

“At least until recently, some of the larger states were some of the weaker economies, in general California, Florida and New York. Among the large states, only Texas had emerged from recession, and the recession there was very shallow,” Cochrane said.