Posted November 20th, 2009 6:03 am

Don’t be expecting the economic conditions in Kentucky or around the United States to be turning the corner anytime soon.

Kentucky Governor Steve Beshear made a pitch for the 2,500 jobs from Harley-Davidson, but the company appears to be leaning towards staying put in Pennsylvania. And that’s not the only bad news.

Those 2,500 jobs were needed in Kentucky. Unemployment lurched back up to 11.2 percent in October, although there are some hints and suggestions that maybe things could be about to improve in the job figures.

From the Courier-Journal report:

Though the job market remains bleak, there are some positive signs, said Justine Detzel, chief labor market analyst for the state Office of Employment and Training.
Led by more hiring for temporary help, the state added about 2,900 jobs in October, she said. It was the third straight month of growth in temp jobs, which employers typically add before bringing on regular staff.
“It’s usually a sign that you’re coming up to a recovery,” she said, while cautioning that employment growth is “not sustained yet.”
…
Another positive sign is that initial claims for unemployment insurance in Kentucky have been falling since December 2008, Detzel said.
“We’re continuing to see fewer people being laid off,” she said.
Kentucky’s business and professional services sector grew the most last month, adding about 5,000 jobs, according to the state. The sector includes temporary help agencies. Gains were seen in temporary hiring at a document processing center and in the opening of a call center.
…

Unfortunately, that unemployment is part of a nationwide one-two punch, and the other punch is housing delinquencies and foreclosures. NPR reported on the continuing and painful drop in the housing markets, and the new records being set for delinquencies:

In another sign of the severe housing-related financial stress that appears far from dissipating, mortgage delinquencies set a new record in the third quarter of 2009, with 9.64 percent of mortgages on one- to four-unit residential properties in arrears, according to the Mortgage Bankers Association.
In other words, almost one in 10 homeowners is behind on his or her mortgage. This is a rate not seen during all the previous recessions since 1972 which is how far back the MBA’s data goes. That’s just stunning.
The worrisome trend makes sense when one considers that unemployment has increased to 10.2 percent. Combined with that, many adjustable-rate mortgages are resetting to significantly higher interest rates making what were once affordable mortgages for some homeowners now unaffordable.
The MBA noted that the increase in delinquencies is no longer about subprime mortgages going belly up. The story now is that owners who once had excellent credit and were able to obtain prime mortgage loans are falling behind in their payments and pushing up delinquency rates.

While the jobs are a lagging indicator, housing is not. The effects of last year’s 4 % delinquency rates were devastating for the global economy. This year’s rate is more than twice that number, and will be a substantial drag on economic recovery.

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