More Island workers than ever are without jobs and seeking unemployment benefits this winter.
Figures from the Massachusetts executive office of labor and workforce development indicate that the unemployment rate for the Vineyard in December was 7.5 per cent, substantially higher than previous years. The figure does not take into effect the large number of self-employed people on the Vineyard, many of whom are ineligible for unemployment benefits, and the so-called underemployed, who are not working as much as they would like or working at lower paying jobs than usual.
Sarah Kuh, program director for Vineyard Health Care Access, which assists people who are on unemployment obtain health insurance through the state, said the fluid nature of the Island workforce makes it difficult to quantify the number of people out of work at any given time.
“The Vineyard falls into a gray area when it comes to measuring unemployment. There are so many people working for themselves — people in between jobs or waiting for the busy season,” she said.
But Ms. Kuh said there is no question her agency has helped more people this off-season obtain insurance while on unemployment. “If I had to guess, I would say there are two or three times more people [on unemployment]. There are a lot of people out there looking for work,” she said.
State figures indicate more people on the Vineyard filed for unemployment this winter than in at least 15 years. The jobless rate in Chilmark increased from 2.6 per cent in December of 2007 to 3.9 per cent in December of 2008; in Aquinnah the rate climbed from 5.2 to 8.9 per cent; in Edgartown it climbed from 5.2 to 9.2 per cent; in Oak Bluffs it went up from 4.3 to 7.8 per cent; in West Tisbury it climbed from 2.6 to 3.9 per cent and in Tisbury it went from 5.8 to 8.7 per cent.
Statewide, the unemployment rate for December was 6.5 per cent, up substantially from 4.1 per cent in December last year.
By comparison, the unemployment rate on the Vineyard in January 1998 was 2.03 per cent; the rate 15 years ago was 4.2 per cent.
The most recent figures from the federal labor department released last Friday indicate that 598,000 jobs were lost nationally in January, the biggest for any single month since 1974. The national unemployment rate is now 7.6 per cent, and some economists are now predicting it may top 10 per cent before it improves.
The labor department also reported that since the start of the recession in December of 2007, a total of 3.6 million jobs have been lost, with about half of that decrease occurring in the last three months. In January, employment declined in nearly all major industries, while health care and private education added jobs. Construction lost nearly 111,000 jobs nationally in January, while the unemployment rate in Massachusetts increased 1.1 per cent during that same period.
Steven Bernier, owner of Cronig’s Markets, said it will be impossible to tell how many people are out of work until this summer. But he agreed the Island economy is struggling, especially with a dramatically slowing construction industry.
“We are seeing the usual seasonal fluctuation in our economy, but this winter there is a tsunami on top of that. You don’t have to read statistics to know things are bad and people are out of work. It’s all around us,” he said.
Mr. Bernier, a member of the commerce and livelihood group of the Island Plan, said he has not had to lay anyone off this winter. But he noted that layoffs can be tricky on the Vineyard due to the cyclical nature of the economy.
“Anyone would be taking a gamble laying people off now, because they don’t know what the summer will look like. Things might be down in February, but we know things will change in a few months. The question is, how much will things bounce back? We may not feel the effect [of the economy] until next winter,” he said.
But he said high unemployment affects the entire Vineyard economy.
“If somebody isn’t working, they aren’t spending. It’s connected,” he said.
Mark London, executive director of the Martha’s Vineyard Commission, said the commission has done studies on the Vineyard’s seasonal economy and how it affects unemployment. One of those, the Ryan Report, was completed in January last year and concluded the Island should move toward a more diverse economy not as dependent on vacation-based industries.
“In general our economy is not as resilient as other communities because we’re not as diversified. That’s not to denigrate the traditional Vineyard-based activities, things like restaurants and real estate and construction — those will remain the most important, but the suggestion is to branch out and be more diversified,” Mr. London said. He continued:
“We are disproportionately dependent on the construction industry. It is the main driving force of the economy, and we all know construction is particularly volatile — it is directly dependent on new growth — and there is nothing to say new growth will be a constant.”
Chris Wells, president and chief executive officer of the Martha’s Vineyard Savings Bank, agreed unemployment rates always spike in January and February on the Vineyard when construction slows down. And while there are signs the building industry will remain sluggish for a while, he said there are some positive economic indicators amid all the doom and gloom.
“We are hearing rental activity is strong, advance bookings are up. And at the bank here loan demand is quite strong . . . I think the general backdrop of the economy is not as bad some people think,” he said.
Mr. Wells said most people have the same amount of money now as they did at this time last year; he said the difference is people are being more cautious about spending. “People are waiting to see what happens with the economy before they spend, and that may play a big role in [new construction] and getting people back to work,” he said.