State’s Employment Levels to Decline

Alabama, one of the shining lights in the South when it comes to employment levels, will likely lose some of its glow in 2009, according to Ahmad Ijaz, an economic analyst with The University of Alabama’s Center for Business and Economic Research.

The rate of increase in Alabama’s job growth has slowed significantly in recent months, according to Ijaz, and that trend is expected to continue well into next year. The economic chaos sweeping the nation will finally find its way into Alabama.

“We will see an increase in job losses in manufacturing, construction, retailing and restaurants,” said Ijaz, adding that the dramatic drop in consumer prices “will make it even harder for some of these firms to survive the downturn.”

Ijaz predicts the state’s unemployment rate will move upward in 2009, even if Alabama’s economy doesn’t contract.

“Problems with housing markets, financial markets and labor markets will affect consumer spending in the fourth quarter and will continue to be a drag on both economic growth and employment,” he said.

He said he expects jobless numbers to inch up to 6 percent, maybe 6.5, early next year. The last time Alabama’s jobless rate hit 6 percent was January 1994.