So far, recession skips Baker

By ED MERRIMAN, Baker City Herald November 17, 2008 03:08 pm

Despite dire economic forecasts in the national and global financial sectors, job creation is up and unemployment is down in Baker County, making the 2008 recession seem tame, so far, compared to some past recessions, according to the November Eastern Oregon Labor Trends report.

While job losses typically pile up during a recession, so far in 2008 the total number of people employed in nonfarm jobs is up slightly in Baker County compared to 2007, which was a record year for job expansion in the county, according to Jason Yohannan, regional economist at the Oregon Employment Division’s La Grande office, and author of Eastern Oregon Labor Trends report.

“So far in 2008, Baker County has held up pretty well,” Yohannan said. “At this point it looks like there won’t be a job loss for Baker County.

“We’re coming off a year that was very good,” he said. “Baker County had record high employment in 2007, so if you’re only a little over the 2007 job numbers, you are not doing too bad.”

In addition to the positive job numbers, Yohannan said unemployment in the county in September dropped to 5.5 percent from August’s revised rate of 5.9 percent. Baker County’s rate was below the statewide rate of 5.9 percent and the 6.1 percent national unemployment rate.

Baker County’s unemployment rate is the second lowest in Northeastern Oregon, behind Wallowa County at 5.1 percent. Other counties September rates were Malheur at 6.1 percent; Grant at 6.4 percent; Union at 6.5 percent; and Harney at 7.4 percent.

Yohannan said there’s still a chance job numbers for Baker County could fall off in the year’s final quarter, but at this point he doubts any decline would be large enough to reverse job gains made earlier in the year.

“So far, the job numbers are better than the last time there was an official recession (in 2001-2003),” Yohannan said.

He said the fact that Baker County has avoided losing jobs so far in 2008 indicates there’s no recession here, at least not yet.

Economic indicators analyzed by the National Bureau of Economic Research show the nation has endured six official recessions during the past 50 years: 1960, 1969, 1973, 1980, 1981, 1990 and 2001-2003.

In most of those recessions, Yohannan said Baker County and other rural counties generally suffered far greater job losses, and often for more years than Oregon or the nation as a whole.

“Past recessions in Eastern Oregon have started earlier and dragged on and on for years after the recessions ended in other parts of the state, and nationally,” Yohannan said.

Based on how much better Baker County is doing this year, compared to past national recessions, Yohannan said things might not be as bad as they appear in national media reports.

For a comparison, Yohannan said in the 1960 nationwide recession, Oregon recorded a 0.1 percent job loss that hit in 1961, while in Baker County the recession lasted from 1959 through 1962 and resulted in a combined 23.2 percent job loss.

During the 1969 national recession, Oregon slid by with minimal job losses, but in Baker County it started two years earlier with a 3.7-percent job loss in 1967, followed by a 7.8-percent job loss in 1969.

In the 1973 national recession, Yohannan said Oregon skated through with no job losses, then had a 0.1 percent job loss in 1975. Baker County job numbers were down 7.2 percent in 1973 and 1974, but no job losses were recorded in 1975.

In the 1980-1982 national recession, Oregon’s unemployment rate rose to 9 percent and stayed there for three years, including all of 1983 — the year after the national recession ended. During that same period, Yohannan said Baker County recorded a 17-percent job loss.

“It was one long, hard three-year downturn for job seekers in Oregon,” Yohannan said.

During the 1990 national recession, Oregon’s nonfarm payroll slipped 0.2 percent while Baker County lost 1.3 percent of its jobs.

During the 2001-03 national recession, judicial rulings on environmental lawsuits that required increased protections for endangered species contributed to a reduction in timber harvests on national forests.

That in turn contributed to the closure 47 Oregon lumber mills, eliminating 3,684 jobs in logging and mills across Oregon, and mainly in rural areas, Yohannan said.

Baker County’s last lumber mill closed in 1996.

Despite that blow to rural communities dependent on the timber industry, Yohannan said Oregon’s nonfarm payroll slipped 2.7 percent statewide during the 2001-03 period, while Baker County’s job loss was 4.1 percent, Yohannan said..

This time around, job losses have been modest. So far this year, nationwide unemployment rose less than 1.4 percent, and by a smaller 1.1 percent in Oregon, according to the report.

While many state and national reports show recessions in 1995-96, and 1999-2000 — Oregon recorded the highest unemployment rates in the nation at 10 percent in 2000 —Yohannan said the list of recessions identified by the National Bureau of Economic Research excluded recessions that primarily hit rural areas but did not extend to major metropolitan areas.

For example, while the National Bureau of Economic Research lists the seven national recessions, Yohannan said Baker County suffered job losses during the past 50 years, including 3.7 percent in 1967; 5.6 percent in 1985-86; 1.3 percent in 1991; 1.4 percent in 1996; and 0.4 percent in 1999.