But local figures aren’t seasonally adjusted

Delaware State News

DOVER — Despite a roller-coaster economy, Kent County’s unemployment rate has dropped from August’s 5.2 percent.

The state Department of Labor’s monthly report says central Delaware is down to a 4.6-percent rate and Dover’s rate dropped from 5.2 percent to 4.4 percent.

The statewide rate remained the same at 4.8 percent, as did the national unemployment rate, which was 6.1 percent in August.

The reason for the drop could be that local rates for counties and cities are not seasonally adjusted, said Tom MacPherson, director of unemployment insurance.

"There are fluctuations in the seasons," he said, with holidays and school sessions affecting employment. "What is really looked at with all states is the seasonally adjusted numbers, which takes into consideration over-the-course-of-the-year fluctuations.

"(The drop) can’t be really attributed to a significant hiring."

The state rate is a seasonally adjusted number, Mr. MacPherson said, adding that it’s definitely good news that it stayed the same.

Sussex County’s unemployment rate stayed the same at 4.3 percent from August to September. New Castle County dropped, from 5 percent to 4.9 percent.

Another good sign was that there was no change in the number of unemployed individuals from August to September, Mr. MacPherson said, remaining at 21,600, which is still up from September 2007’s total of 14,500.

A total of 700 jobs were lost over the month, he said, mainly in construction.

"It’s primarily construction and it’s certainly tracking the nation," Mr. MacPherson said. "In construction, of course, you have homebuilding."

In the year to date, however, Delaware has seen a net gain of 1,400 jobs, a rise of 0.3 percent, according to the report, mainly in education and health care. Nationally, on the other hand, during the past 12 months there has been a 0.4-percent job loss.

Even though September saw a halt in unemployment’s rise, Mr. MacPherson said that will probably not become the trend, especially with recent layoff announcements. Seaford’s Invista nylon plant said this week it would let go 400 of its 500 employees by the middle of next year, and the General Motors plant in Wilmington will lay off 400 workers in December.

"We’re still going to see some increases before it falls back and stays back," he said. "We’ll still see fluctuations in unemployment for some time."

Closing of two companies brings frustration to area

Delaware State News

DOVER — By the end of the year, close to 200 jobs will leave Kent County with the closing of two major area companies.

In July, Discover Card announced it would close its Dover-based payment-processing center in the fall after 17 years, impacting 114 workers at the Kent County AeroPark facility on Horsepond Road.

The company cited an industry-wide conversion from paper-check processing to electronic-payment processing.

Then, in the middle of August, the long-standing Dow Reichhold Specialty Latex plant near Cheswold announced it will shut its doors at the end of the year, costing 81 workers their jobs.

Company spokesman Mike Crisp said the reason the 50/50 venture between Dow Chemical Co. and Reichhold Inc. will close is because the plant is no longer in line with the strategy of either parent company.

"Rarely is it a one-sided explanation," said Dr. Samuel B. Hoff, Delaware State University George Washington distinguished professor of history and political science.

There are many reasons companies decide to close, resulting in layoffs of many employees, he said.

"Downsizing in industries is a reason they are leaving," Dr. Hoff said.

That is what happened with Discover Card — a transition in the way people handle their bills. Instead of the company receiving a multitude of checks for credit card bills, more people are paying online, which leaves less work for bill processors.

David Benson, one of the affected workers, said it came as a blow when he learned he was getting laid off from his job of 14 years.

"It’s a bad time for my job to up and leave," he said, adding he had a baby girl born last month. "The hardest part is starting all over again. After 14 years, you get some seniority and vacation built up; then, you go to a new company where you are low man on the totem pole."

But his search for a new job is going well, he said, connecting with friends and using the Internet to find something suitable.

"Economic factors are contributing," said Mike Karia, adjunct professor of financial management at Wilmington University and former city of Dover finance director. "The cost of products, the cost of employees are higher compared to years ago."

However, with so many companies consolidating, Mr. Karia said Discover and Dow Reichhold might have left the county even without the economic slump because of finding easier ways of doing business.

Former Kent County Levy Court Commissioner Michael Cebrick said economic development is an issue the county has faced since his time in office four years ago. He said the last big economic impact to hit the county was when General Foods, now Kraft, came to Dover in 1964.

But Mr. Karia is hopeful for the county, citing the central location Delaware offers to business hubs like Philadelphia and Baltimore, the lower land costs and ethics of the people as incentive for major companies to move in.

"The 45-minute time cost is nothing now as compared to 20 years ago," he said of the commute to surrounding cities. "There are so many factors that it just has to heat right at the right time. Kent County has tremendous potential in the sense of any CEO trying to locate on the East Coast.

"Kent County is a diamond in hiding."