The West Virginia labor market softened, once again, in November. In addition, the slight job expansion reported for October was revised down to a small loss such that employment in West Virginia contracted for 10 consecutive months. Although the unemployment rate edged down in November, the decline was entirely due to a contraction in the labor force. In other words, the West Virginia labor market remained in challenging territory in November.

The establishment survey indicated that, after adjusting for seasonal factors, employers in West Virginia cut a net 900 jobs in November. In addition, with a downward revision of 300 jobs in October, the 200-job increase in that month turned into a 100-job loss for the state. Altogether, the West Virginia labor market lost 17,500 jobs, or 2.3 percent, from January to November 2012.

A few industries did realize employment gain in November, including government (100 jobs); mining/logging (300 jobs); trade, transportation, and utilities (100 jobs); and leisure and hospitality (400 jobs). Despite November's gain, two of these sectors—government and mining/logging — reported the biggest losses since the beginning of 2012, as the sectors shed 5,700 jobs and 5,200 jobs, respectively. The government losses since January were entirely in state and local government. In November, the industry which saw the biggest decline was construction, which shed 1,200 jobs. Again, November's performance contrasted with the rest of the year, however, with construction losing only 400 jobs since the beginning of 2012 — one of the best performances of any industry in the state. In fact, the construction industry was outperformed only by the education and health services industry, which added 2,900 jobs since the beginning of the year. Over the last 12 months, West Virginia lost a total of 13,800 jobs (1.8 percent). No goods-producing industry and only a few service-providing industries — particularly professional and business services, education and health services, and leisure and hospitality — added jobs on a year-over-year basis.

At first glance, the household survey report for West Virginia seemed to contradict the results of the establishment survey, with the unemployment rate falling by two-tenths of a percentage point to 7.3 percent in November. However, the decline in the number of unemployed was smaller than the decline in the labor force. In other words, both the number of unemployed and the number of employed in West Virginia decreased in November, indicating that the unemployment rate decline was a reflection not of labor market improvement, but of West Virginia workers leaving the labor force altogether. At 53.6 percent, the labor force participation rate in the Mountain State fell to its lowest mark since December 1989. The unemployment rate remained above its 4.1 percent mark at the beginning of the Great Recession, although it was below the 7.8 percent rate in November 2011. The unemployment rate was also below the national rate of 7.7 percent in November 2012.

In sum, West Virginia labor market conditions remained bleak, with earlier improvement erased and a continued decline in employment in the state.