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State picks up 11,600 jobs in step toward recovery

By Shirleen Holt
Seattle Times business reporter

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The state contributed one-third of all jobs created nationwide in July. U.S. nonfarm payrolls rose by a meager 32,000 jobs last month, far fewer than the 200,000-plus economists had predicted. Economists have said fewer jobs are being created nationally because of workers' increased productivity.

The state's unemployment rate dipped, from 6.1 percent in June to 6 percent last month. The change mirrors the slight drop in the national jobless rate, which fell from 5.6 percent in June to 5.5 percent last month.

The Seattle metro area saw most of the state growth, with 8,100 new jobs, mostly in hospitality, business services and retail.

Those numbers are adjusted to reflect seasonal changes in staffing.

Christian Monea, owner of Express Personnel Services in downtown Seattle, says demand for temporary and permanent workers through his company has been rising steadily since March and has more than doubled since the recession ended last summer.

"The most noticeable growth has been on the office side," Monea said. "Companies that may have put on a hiring freeze or cut back personnel in the downturn are starting to have positions open up."

For a while, it looked as if Washington's recovery had stalled. Employment growth in May and June had slowed to a combined 5,800 new jobs after rising sharply in March, when the state added a revised 11,500 jobs.

July's upturn compensates for those down months, said Roberta Pauer, a regional economist with the state Employment Security Department.

But such a steep rise won't be the norm, she said.

"It's unusually strong," Pauer said. "A better expectation would be an average of 6,000 statewide jobs a month."

The hospitality industry added 2,800 nonseasonal jobs, followed by professional and business services (2,100 jobs), construction (1,500) and manufacturing (1,200).

The spike in manufacturing was largely due to food processing, such as canning and freezing, and truck production, Pauer said. Paccar recently began filling 250 jobs at its Renton Kenworth plant.

Boeing's decision to add 3,000 jobs in the Puget Sound area won't show up in job figures until later this year.

Another contributor to last month's job growth could be that employers are feeling confident enough to convert temporary help or independent contractors to permanent full-time positions.

Lux, a Web development and documentation firm in Seattle with 20 employees, plans to grow to 50 full-time workers by next year. The company's strategy has been to start out with contractors, then convert them to payroll employees as the business grows.

That is a way to test job candidates and a hedge against business fluctuations.

"The way we have worked is the first round of contractors get moved to employee status if they want it," said Todd Tibbetts, a company founder. "Then the next round are brought in as contractors. That allows you to add these layers of employees in a slower fashion."

Washington's labor market, Pauer said, has recouped 64,500 of the 84,200 jobs lost during the recession, which lasted from January 2001 to June 2003. It needs to create 19,700 more to reach pre-recession levels.

Even so, the labor market is already tightening in some sectors.

"The last couple of years, if you had a specific type of job where you needed a specific type of person, you could find them pretty easily," Monea said. "Now when I call them two days or a week later, they've already found a job. That's telling me there are more opportunities out there for people."

Shirleen Holt: 206-464-8316 or sholt@seattletimes.com

Copyright © 2004 The Seattle Times Company

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