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More seek work in recovering economy Rise in unemployment reflects hope in market

The unemployment rate in the Buffalo Niagara region rose to 8.5 percent last month -- the highest jobless rate for any May in at least 22 years, the state Labor Department said Tuesday.

The worsening unemployment rate, however, has its roots in the region's slowly strengthening job market: As the area continues to add jobs at a modest pace, more workers who previously had given up on finding a job now are starting to look for work once again.

That renewed optimism within the workforce actually helps drive up the unemployment rate during the early stages of a rebounding job market. Workers who have stopped looking for a job aren't counted in the unemployment data, which only includes people who are actively looking for work.

As a result, the local unemployment rate worsened during May and now is almost a full percentage point higher than it was a year ago, when it stood at 7.6 percent.

The local unemployment rate also is well above the U.S. jobless rate of 7.9 percent, although it's less than the statewide rate of 8.6 percent. Those rates are not seasonally adjusted.

Among New York's 14 metro areas, the Buffalo Niagara region ranks in the bottom half, with an unemployment rate that tied with Binghamton for the eighth-highest in the state. Only New York City, Elmira, Kingston, Syracuse and Utica had higher jobless rates.

While the jobless rate typically declines from April to May because of an uptick in seasonal hiring, this year bucked that trend, with unemployment rising from a downwardly revised 8.2 percent in April. Only twice in the last 20 years has the local jobless rate gone up from April to May.

Although the region continues to add jobs at a modest pace, the growth rate has slowed over the last three months and was just 0.4 percent in May. That sluggish growth is only a little better than a quarter of the 1.5 percent statewide increase, and it also lags far behind the 1.4 percent annualized growth rate nationally.

Even so, the overall trend in local employment remains positive, with the region adding jobs for the 20th time in the last 21 months during May. That, in turn, has helped lure more discouraged workers back into the job hunt. The region's labor force grew slightly from April to May, with 900 additional workers joining the labor pool.

But the job market had trouble absorbing those additional workers as the pace of job growth slowed. That sluggish growth was offset by a nearly 12 percent increase in the number of unemployed workers in the region over the past year.

The region now has 48,200 workers who are unemployed, also the highest level for May in the last 22 years, the Labor Department said. The area now has 23,100 more unemployed workers than it did before the recession began five years ago.

Nationally, employers in April posted the fewest job openings in five months, suggesting hiring will remain sluggish in the months ahead.

The U.S. Labor Department said Tuesday that job openings fell to a seasonally adjusted 3.4 million in April, down from 3.7 million in March. The March figure was the highest in nearly four years.

The decline could mean employers are growing more cautious about adding workers in the face of financial turmoil in Europe and slower growth in the United States. Job openings can take one to three months to fill.

There were 12.5 million unemployed people in April. That means there was an average of 3.7 people competing for each open job. In a healthy job market, the ratio is usually around 2 to 1.

The Associated Press contributed to this story.