Maine continues to have the lowest unemployment rate in New England, but the estimated figure of just under 7 percent for June fails to capture the extent of people who are out of work because of the coronavirus pandemic.

The state’s estimated jobless rate was 6.6 percent in June, down from May’s 9.3 percent and well below April’s peak of 10.6. However, those numbers are based on household surveys that either don’t count or improperly classify people who haven’t been actively looking for work because of safety concerns or stay-at-home orders, or who were laid off but expected to return to their job.

“Instead of being counted as unemployed, they’re being counted as out of the labor force, like retirees,” said Glenn Mills, an economist at the Maine Department of Labor, during a conference call with reporters Friday. “It’s leading to a significant undercount of people who are unemployed in reality. … That’s a big part of why our unemployment rate is so low.”

The number of jobless Mainers officially decreased to 44,100 for June from a revised 62,700 for May, but state economists peg the true number of unemployed at closer to 86,500. That translates to a more accurate jobless rate of 12.4 percent, which remains lower than the unofficial national average of 15 percent.

With four months of data, the pandemic-affected employment picture is becoming clearer, but still isn’t as sharp as it could be.

“The 6.6 percent does not reflect the magnitude of job displacement that has occurred,” said Mills, noting that Maine had higher unemployment rates a decade ago.


Following historic job losses in March and April, Maine’s economy rebounded in May, and that progress continued in June with the addition of 19,000 jobs, for a total of 33,200 added over the two-month period. Even so, the total number of jobs remained 71,300 lower than in February, a drop of 11 percent.

Maine’s official unemployment rate of 6.6 percent was less than half of that in the New England region (13.4 percent) and well below the 17.4 percent rate of Massachusetts. Only Connecticut (9.8 percent) and Vermont (9.4 percent) were also below the national rate of 11.1 percent.

Nearly all job gains in June came from the state’s private sector. Health care and social assistance businesses added 6,000 workers but remained 8.1 percent below February levels. Retail was up by 4,500 jobs.

Hotels, restaurants and bars were among the first businesses to close when the pandemic took hold in Maine in March, and although the hospitality sector added 5,900 jobs in June, it remained down 42 percent from four months earlier.

“We’re seeing strong gains,” said Mark McInerney, director of the Center for Workforce Research and Information, “but an industry that employs substantially fewer people than it was in February.”

Across all 16 counties of Maine, unemployment rates for June were higher than they were a year earlier. Western Maine counties of Oxford (8 percent unemployment), Somerset (7.4 percent) and Franklin (7.4 percent) showed the state’s highest official levels. Mid-coastal Sagadahoc County (5.4 percent) had the lowest rate, and Aroostook, in the far north, showed the smallest increase from last June, rising from 4.6 percent to 5.7 percent.


In southern Maine, Cumberland County recorded an unemployment rate of 6.7 percent, same as that of Androscoggin County and slightly above the 6.6 percent in York County.

The same data issues complicating Maine’s unemployment estimates affect those at the national level. The federal Bureau of Labor Statistics works with state workforce agencies and the U.S. Census Bureau to conduct employer payroll and household surveys. The structure of the household survey did not anticipate a pandemic that prevents people who recently lost a job from safely looking for a new one.

The bigger issue, Mills said, is improperly classifying those who are temporarily unemployed as being “employed, not at work,” as if they were on vacation or out sick. Surveyors are aware of the problem, and Mills said the situation is improving.

“The number of misclassified people in Maine (14,100) is half what it was last month,” he said. “We were hoping it would be very low, but it wasn’t. Hopefully next month it will be very low. And if so, that could cause our unemployment rate to go up even if there are job gains.”

Also unclear is whether the jobs added in June were temporary or full-time positions. Because the data is derived from surveys, most respondents have no way of knowing the financial status of their employer.

“We also don’t know what additional (relief) packages will come out of Congress,” Mills said. “So some companies that right now appear like they will go into bankruptcy and fail might be saved.”

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