CHAMPAIGN, Ill. (AP) — Nine consecutive months of decreases in Illinois’ unemployment rate ended in June with a modest increase that state officials said Thursday may have driven in part by shaky confidence among consumers.
The unemployment rate rose one-tenth of a percent to 8.7 percent in June, the Illinois Department of Employment Security said in its monthly report on statewide joblessness. National unemployment held steady at 8.2 percent, the federal government said earlier this month.
Illinois officials say they weren’t surprised by the increase, after last month’s report indicated sizable job losses among construction firms and in other areas, signs that the state might be following the rest of the country back into a period of economic stagnation.
“The slight increase in the unemployment rate was expected and follows the path of the nation,” department Director Jay Rowell said. “The long-term growth trend will be influenced by consumer confidence as it responds to the economic fortunes in Europe and China as well as the path Congress pursues to avoid automatic spending cuts and tax increases.”
In all, Illinois employers added a net 4,700 private-sector jobs in June. The number of unemployed people around the state rose by 7,900, or 1.4 percent, to 572,200.
State officials were quick to point out that a year earlier Illinois had a much higher unemployment rate — 9.9 percent — and that two years ago the jobless rate was well over 10 percent.
The state’s trade, transportation and utilities sector was particularly hard hit in June, losing a net 4,900 jobs. The biggest losses appeared to be among retailers, suffering from weak consumer confidence, department spokesman Greg Rivara said.
Consumer confidence is a source of serious concern “and it’s been a source of concern for a long time,” he said.
The Conference Board, the privet group that tracks consumer confidence around the country, reported a few weeks ago that Americans’ confidence in the economy slipped in June, a fourth straight decline.
“Income expectations, which had improved last month, declined in June,” the board’s director of economic indicators, Lynn Franco, said in a printed statement. “If this trend continues, spending may be restrained in the short-term.”
But Peter Gill of the Illinois Retail Merchants Association said that, based on anecdotes from the group’s members, the June job losses in the sector may have been an anomaly. Retailers, he said, haven’t reported major decreases in sales or employment, and even seem to be optimistic about what lies ahead.
“What we’re expecting to see is a halfway decent back to school season,” Gill said. “If that happens as we predict, maybe we’ll see some consumer confidence build from that.”
Government employers also shed large numbers of jobs in June, a net loss of 3,900. Most were at the local level, Rivara said, and many were likely at schools cutting back for the summer.
Leisure and hospitality businesses, though, added a net 3,900 jobs. That figure, though somewhat at odds with the losses among retailers, isn’t unusual in the summer, Rivara said.
“You’ve got increases, particularly in restaurants,” he said. “You have what you would expect in the summer months.”
Manufacturers also added jobs, a net increase of 2,400, continuing a trend of strong hiring.
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