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Despite only a very small increase in area unemployment rates last month, figures released Friday for Western New York and the remainder of the state show a worsening economy.

The unemployment rate in Erie and Niagara counties rose slightly to 4.5 percent in November, but it was well below the 5.3 percent statewide rate.

But those figures disguise a softening labor market, according to Ronald H. Scrace, senior economist in the Buffalo Office of the Labor Department.

The number of people employed in the Niagara Frontier fell over the 12-month period from 530,300 to 521,100. It's the first year-to-year job loss in the area since 1983.

Much of the job loss was in manufacturing, largely due to layoffs by the auto industry. The number of people employed in manufacturing was down by 1,200 to 97,400, the second lowest figure ever recorded. The lowest was 94,500 in January.

Retailers also hired fewer workers than normal for the Christmas shopping season. The 1,600-job increase was the smallest since 1981. It was 30 percent below the normal 2,200 rise.

In the service sector, which has been breaking employment records each month for the past three years, employment fell by 500 from the record October high of 148,600.

Erie County had a 4.5 percent unemployment rate in November and Niagara County had a 5.4 percent rate.

In other Western New York counties the November rates and the past rates were:

Allegany County -- 4.9 percent in November, 4.5 in October and 5.9 percent in November 1989.

Cattaraugus -- 6.2, 5.2 and 7.

Chautauqua -- 5.1, 4.8 and 6.2.

Genesee -- 5.6, 4.8 and 6.1.

Orleans -- 6.9, 4.2 and 7.8.

Wyoming -- 6.2, 5.8 and 5.8.

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