February 09, 2009 For Glens Falls, a dubious achievement Area's jobless rise - to 7.7% from year before is - highest in state
By CHRIS CHURCHILL, Business writer
First published in print: Wednesday, January 28, 2009
GLENS FALLS At a time when joblessness is rising nearly everywhere, no metropolitan area in New York is seeing a larger unemployment spike than Glens Falls and its surrounding communities.
The unemployment rate in that metro area defined by the U.S. Census Bureau as Warren and Washington counties climbed to 7.7 percent in December, up from 5.1 percent a year earlier, according to the state Department of Labor.
That's the largest year-over-year increase among New York metros.
Likewise, the Glens Falls area had the largest percentage increase from November to December, when joblessness climbed by 1.3 percent.
The Glens Falls area includes Lake George and other tourist hot spots. For that reason, unemployment in the region is highly seasonal, tending to climb every year when the weather turns cold.
Yet the steepness of this year's spike took some officials by surprise.
"If we'd had a large employer lay people off, I would have expected this," said Todd Shimkus, president of the Adirondack Regional Chambers of Commerce in Glens Falls. "But it was a lot of little layoffs that added up to that number you're seeing."
It would be tempting to lay blame for the area's unemployment rise at the feet of the tourism industry, which has reacted to the economic slowdown by scaling back winter operations even more than usual.
But Department of Labor statistics would belie the claim.
In fact, while the hospitality sector in Washington and Warren counties dropped about 100 jobs during the course of 2008, that's no more than were shed by sectors like government, professional services, manufacturing, construction or natural resources.
Instead, much of the rise in joblessness comes from retail-related cutbacks, which eliminated 500 jobs. That makes the Glens Falls area which in recent months saw mall retailer Steve & Barry's close and chains Oneida Ltd. and Pfaltzgraff announce plans to shutter stores part of the broader trend affecting retail.
"Sometimes it has nothing to do with local geography," said Luisa Sherman, executive director of the Lake George Chamber of Commerce. "It's a corporate decision that is made halfway around the country."
Small retailers, too, are noticing changes in consumer behavior: "People are buying much more cautiously than they were before," said Naftali Rottenstreich, co-owner of Red Fox Books in downtown Glens Falls.
Unemployment rose in every U.S. state in December, and it rose in every New York metro area.
The population of the Glens Falls metro area, though, is just 130,000. Much of the area is anything but urban or metropolitan, so slight employment shifts have a large impact.
"Small changes in job counts can result in big changes in the percentages," said James Ross, a labor market analyst with the state Department of Labor.
Indeed, the department says the Glens Falls area had 1,800 more unemployed people in December than a year earlier.
By contrast, the Albany-Schenectady-Troy area, where the unemployment rate is 5.9 percent, saw the number of unemployed grow by 8,000 during the period.
Still, the December unemployment rate in Glens Falls is the highest December rate since 1993.
"Everyone is taking a wait-and-see approach to hiring and work force levels right now," said Shimkus, in particular citing worry among business owners about state-imposed tax increases and other economic factors.
"The level of uncertainty right now is skyrocketing," he said.
Chris Churchill can be reached at 454-5442 or by e-mail at cchurchill@timesunion.com.
Spiking unemployment
No metropolitan area in New York has seen unemployment rates grow faster than the Glens Falls region, which includes Warren and Washington counties.
