Unemployment hits 8 percent in Oregon

By Hector Cordon
24 May 2003

Oregon continues to lead the nation in joblessness, as April’s unemployment figure showed a four-tenths of a percent increase to 8 percent. This is the highest percentage since February 2002 and represents the loss of 11,200 jobs in nonfarm employment since April of last year. The total number of unemployed in Oregon now stands at 147,270. The total number employed stands at 1,557,700, the lowest level since October of 1998.

Unemployment in Oregon now exceeds by 2 percent the national rate, which increased to 6 percent in April, a level unseen since 1995. State economists worry that the unemployment figures indicate that the economy is continuing to weaken.

Manufacturing led job losses with 8,300, followed by government with 3,300 and construction with 2,100.

In manufacturing, durable goods, which includes wood and metal products, lost 5,200 jobs. The electronics industry lost 2,800 of those jobs, most of them in semiconductor and electronic components manufacturing. Non-durable goods, which include food, paper and printing, lost 3,100 jobs.

Construction, which normally sees 1,300 jobs added in April with improved weather, lost 2,100 from a year ago. Although the lack of hiring has been attributed to an abnormally rainy April, closer analysis reveals that commercial nonresidential building—business and government—accounted for the loss of 1,800 jobs, whereas residential construction, spurred on by low interest rates, contributed 400 new jobs. Heavy and civil engineering construction lost 800. Specialty trades, foundation builders, equipment providers added 100 jobs.

The lion’s share of cuts in government employment occurred in local education, with 3,000 jobs lost.

In Portland, the teachers union agreed that teachers would work 10 days without pay. Suburban Hillsboro has closed schools 17 days early. Out of 198 school districts, 91 have reported cutting days from the 2002-2003 school year, losing an average of five days each. Most of these districts are staggering the days off instead of closing early, in order to avoid paying unemployment benefits to the teachers.

School districts have severely curtailed programs due to last year’s huge state budget deficit, which resulted in the slashing of $1 billion from state programs. The latest revenue forecast shows the state receiving $634 million less than anticipated two months ago and $1.1 billion less than what was expected in January when this budget was presented. For the 2003-2005 budget, Democratic Governor Ted Kulongoski will have to eliminate $3.2 billion from continuing programs approved by 2001 legislature.

The 2003-2005 school budget presented by the legislature calls for a funding level of $4.7886 billion, lower than the 1999-2001 biennium, when the budget was $4.859 billion. Schools would need about $6.0 billion to maintain the same levels of staffing and programs as the 2001-2002 school year.

Public services also face unprecedented shortfalls due to the cuts made in last year’s budget. The elimination of prescription benefits by the Department of Health Services has resulted in the highly publicized suicide of one person and the open-ended hospitalization of another. State officials are investigating the role these cuts may have played in the suicide of four individuals and the attempted suicide of one other.

The Oregon Health Plan will be dropping one-quarter of its plan members on July 1 due to a loss of funding.

Over 100,000 members, mostly adults in low-wage jobs, will lose coverage unless the legislature reinstates funding, which appears unlikely. Last November, a legislative emergency board dropped mental health services and addiction treatment for 110,000 health plan members. In addition, it instituted a monthly premium of from $6 to $20, resulting in 10,000 participants being dropped from the plan for failing to pay. Many participants are now also required to make co-payments for services or prescriptions.

Meanwhile, the Oregon Health & Science University (OHSU) announced that its new budget, while increasing by 13%, will eliminate jobs and health programs for the poor, and include a hike in tuition. Among the programs scheduled to close is the Oregon Poison Center, which will result in the elimination of 175 to 200 employee positions. The Poison Center provides a specialized service to an area that extends from Alaska down to Nevada. Callers, who numbered 70,000 last year, included frantic parents, 911 dispatchers, as well as doctors and nurses seeking advice on diagnosing, treating or transporting poison victims. OHSU cites decreasing state reimbursement for medical and dental care that it provides to the poor as forcing its hand in making this cut.

The university will also reduce funding for the Office of Rural Health and the Child Development and Rehabilitation Center. Many rural clinics will be closed, and about 900 children with disabilities, mental heath needs and birth defects will lose services.

In contrast, the areas that have received substantially increased funding, allowing OHSU’s overall budget to grow by $150 million, are in research and biomedical engineering. These are areas that would allow the university to make money through patent royalties, public/private partnerships with businesses and spinning off its own profit-making ventures.

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