January 22, 2009 11:42 AM

Mass. unemployment rate highest in 15 years
Posted by Jesse Nunesat 11:42 AM

The following article originally appeared in the Business News Updates blog on Boston.com.

By Robert Gavin, Globe Staff

The Massachusetts economy deteriorated sharply in the past two months as employers slashed nearly 40,000 jobs in November and December, and the unemployment rate soared to the highest level in more than 15 years, the Executive Office of Workforce Development reported.

Employers cut nearly 17,000 jobs last month, the state reported, and job losses were much worse than initially estimated in November. Employers cut more than 22,000 jobs in November, 14,000 more than were first reported. State officials said the unusually large revision is the result of procedural changes made by the US Department of Labor.

The Massachusetts unemployment rate last month jumped a percentage point, from 5.9 to 6.9 percent, the highest rate since October 1993. The state jobless rate was 4.3 percent in December 2007. The number of unemployed has increased by nearly 90,000 over the year.

The surge in joblessness reflects impact of the national recession, which many economists expect to be the worst since the Great Depression. The nation shed more than 1 million jobs in November and December, and the unemployment rate rose above 7 percent for the first time since 1986.

In Massachusetts, job losses were broad. Professional and business services, a key employment sector that includes consultants, scientific and technical firms, lost 7,500 jobs. Retailers shed 3,100 jobs. Construction firms slashed 2,500 jobs, and manufacturers 1,000. Education and health care services, which includes universities and hospitals, lost 700 jobs.

Few major sectors added jobs. Information, which includes software publishers, gained 200 jobs. Government added 500 jobs.