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New Massachusetts Unemployment Figures Offer Glimmer Of Hope

The Marriott Long Wharf hotel in Boston. (Robin Lubbock/WBUR)
The Marriott Long Wharf hotel in Boston. (Robin Lubbock/WBUR)

The state's unemployment rate remains more than twice what it was before the pandemic — the 13th highest in the nation, between Texas and Pennsylvania.

But some areas of the Massachusetts economy are showing strong signs of growth.

On Friday, the state reported the jobless rate of 7.1% in February, down from 7.8% in January. And the hospitality and leisure sector, one of the hardest hit, saw its first significant gains since the start of the pandemic.

That sector, which also includes hotels, restaurants, and recreational facilities, was clobbered by the coronavirus — devastating tourism and prompting many locals to stay at home. Jobs in the sector are down 30% from a year ago. But employment edged up 4% in February after months of little to negative growth.

Carlos Aramayo, head of the service workers union UNITE-HERE Local 26, says the COVID-19 vaccine could be spurring more people to leave the house and spend money.

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“We are hopeful that there is significant pent-up demand, that once people feel comfortable with travel and with tourism again, that there will be a ... surge of business into the industry,” he said.

The number of people applying for unemployment benefits in the hotel and restaurant sector also declined last month. Unemployment applications were down 20% in February, compared to a 9% decrease across all Massachusetts industries.

But wages for hotel and restaurant workers also declined sharply compared to pre-COVID levels, according to the state Department of Unemployment. The average weekly wages of these workers, $568, represents a 14% decline since February 2020 — that's while wages were stagnant across the state.

In contrast, wages in the highest-paid sector, insurance and finance, rose 39% over the year, to $3,206 in February. Unlike much of the hospitality industry, many financial firms could continue to operate remotely.

Recessions can have disparate impacts on different sectors. But Rod Motamedi, an economist at UMass Dartmouth's Donahue Institute, says the COVID recession is "particularly brutal for certain subsets of workers and certain demographic groups."

Motamedi says he's optimistic that the February unemployment numbers point to a turnaround. But he says any good signs need to be considered in the context of an erratic public health crisis.

"We might very well be one vaccine supply shortage, or one virulent variant away from people losing faith [in being safe among the public]," he said.

"So because I have no sense of what the epidemiological picture is going to be, it's hard to say that this is a surefire sign of a turnaround."

The biggest loser in the February unemployment numbers was government — down nearly 9% from January. Geoff Beckwith, head of the Massachusetts Municipal Association, says local governments have adopted "very conservative budgets" over the course of the pandemic, which could explain the increase in jobless claims last month.

But Beckwith said he's optimistic that the Biden administration's new relief package will bring more government employees back to work.

Simón Rios Twitter Reporter
Simón Ríos is an award-winning bilingual reporter in WBUR's newsroom.

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