Maine’s unemployment rate in July slipped to its lowest level since the beginning of the pandemic in a labor market that remains strong despite high inflation and recession worries.

The statewide unemployment rate was 2.8 percent last month, which is the first time it has been below 3 percent since February 2020 and nearing the record low joblessness rate set three years ago, the Maine Department of Labor reported Friday. From April to June 2019, Maine’s unemployment rate was 2.6 percent.

The nationwide unemployment rate in July was 3.5 percent.

The three-month average unemployment rate – a better indicator of workforce conditions – was 3 percent between May and July, about 0.6 percentage points lower than the previous three months, the department said.

Maine employers added 2,800 jobs in July, an increase after several months of small job losses. Industries with the largest job gains were local government (mostly schools), leisure and hospitality, retail, professional and business services.

Even as the state’s unemployment rate – which measures the number of people who are out of a job and actively looking for work – has ticked down, the state’s active workforce, which includes everyone working or looking for work, remains stubbornly low. Maine’s labor force participation rate in July was just around 59 percent, roughly the same as it has been since it fell more than 3 percentage points in March 2020 at the onset of the economic crisis triggered by the pandemic. The U.S. labor force participation rate is around 62 percent.

As of July, the state’s labor force was about 659,000 workers, about 21,000 fewer than before the pandemic. The loss of that many people from the labor force is partly what has led to the hypercompetitive labor market in the state.

Some counties and metro areas in Maine had even lower unemployment rates last month than the state as a whole. Sagadahoc County had a 2.2 percent unemployment rate, while York and Cumberland tied with a 2.3 percent rate, the same level as in Portland-South Portland.

Aroostook, Washington and Somerset counties had the highest jobless rate at 4 percent, according to the Maine Department of Labor.

Only subscribers are eligible to post comments. Please subscribe or login first for digital access. Here’s why.

Use the form below to reset your password. When you've submitted your account email, we will send an email with a reset code.