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updated: 7/21/2011 11:51 PM

Illinois unemployment rises for second straight month

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Associated Press

CHAMPAIGN -- Illinois' unemployment rate edged up again in June, but the experts say that likely means something you already knew: The economic recovery isn't going nearly as fast as the state needs it to.

Statewide unemployment rose to 9.2 percent in June, up from 8.9 percent in May and the second straight increase after 15 months of declines, the Illinois Department of Employment Security said Thursday. The national unemployment rate also hit 9.2 percent in June, the federal government said earlier this month, up from 9.1 percent.

"It more or less confirms what we've seen the last several months, that the economy is recovering very slowly," said Fred Giertz, a University of Illinois economist who closely follows the state's economy. "A slow recovery is not the same as saying the economy's going to have a double dip (recession)."

"Illinois is part of the country," he added, "and the country's not doing particularly well."

Thursday's state report laid out a number of examples of how Illinois' economy isn't either.

The number of people in the state out of work and looking increased in June by 18,900 to 603,700. The jobless rate, meanwhile, is at its highest point since December 2010.

And three key employment sectors shed several thousand jobs each: government, 3,500 jobs; and educational and health services, another 3,500; and professional and business services, 2,900.

The government jobs, Department of Employment Security spokesman Greg Rivara said, were most likely at the local level, where cities and counties continue to struggle.

And Giertz said the losses in professional and business services -- which includes banks and financial service companies -- weren't necessarily a reflection of poor health among companies in that sector, but rather another aspect of the weak recovery. Companies in many areas are finding that even as business improves they don't need as many people as they once did.

"It's a matter of increased efficiency and streamlining, and situations where the economy's not growing as fast to absorb the extra people," he said.

But state officials found two areas for optimism: construction and manufacturing, which added 1,100 jobs and 900 jobs, respectively, in the month.

Both sectors, Rivara noted, were hit particularly hard by the recession. And while manufacturing has been slowly picking up in the state in recent months -- the sector has averaged 2,600 new jobs a month over the three months -- construction has been stubbornly slow, held down in large part by the lack of demand for new homes.

"To see construction growth is encouraging," Rivara said.

With summer, construction has picked up at schools doing maintenance and other work, said Mike Hampson of the Fox Valley Associated General Contractors in suburban St. Charles, a trade group that represents about 150 contractors and others who do business with them.

"There are pockets of encouragement," he said, "but for the most part there seems to be a lot of hesitation in the market."

Any improvement in construction is a positive, Giertz said, but construction in the state has been so slow that the bar isn't set very high.

The continued manufacturing increases, on the other hand, are more meaningful, he said.

"We have gotten a little bit more competitive in manufacturing, so I think that's probably a real plus," he said.

The state will release unemployment data for counties and metropolitan areas next Thursday.