Unemployment rose in Allen County and most of northeast Indiana in October after months of steadily improving reports. Regional experts say that in this slow recovery from a deep recession, ups and downs in monthly unemployment figures are likely to continue.

Unemployment rates in Allen County fell in July, August and September, reaching 9.3 percent in September. However, that rate increased to 10.1 percent in October. In seven of 10 northeast Indiana counties, unemployment was higher in October than in September, according to figures released Friday by the Indiana Department of Workforce Development.

“This was not your normal recession. It was not a typical business-cycle recession,” said John Stafford, who directs the Community Research Institute at IPFW. He said he expects to see uneven job recovery in the area, with some of the kind of reversals October figures indicate, through 2010. “We're going to continue to see ups and downs,” he said.

Indiana as a whole is faring better than this corner of the state or the United States. The state's unemployment rate was 9.8 percent in October, less than the national rate of 10.2 percent. Wells County is the only county in northeast Indiana with unemployment of less than 10 percent (9.8 percent). Noble County's unemployment rate, 14.7 percent, was the highest in the region last month.

“Indiana's unemployment rate has held relatively steady for the past three months despite a steadily climbing national rate,” said Teresa Voors, commissioner of workforce department, in a news release Friday. “However, a projected soft holiday retail season combined with a slump in manufacturing and hospitality employment tempers my optimism concerning the coming months.”

Stafford said northeast Indiana's continued strong dependence on manufacturing makes this region more vulnerable to faltering consumer confidence. If consumers aren't buying durable goods – most notably, motor vehicles – there's less demand for labor in area factories.

Michael Hicks, director of the Business Research Bureau at Ball State University, said the latest unemployment numbers might mean “we could be at the bottom of the trough” and recovering. But he also agrees that there will be some “natural oscillation” in unemployment. Beyond that, he's concerned that three pieces of federal legislation being debated now are of such concern to businesses that they may be slowing recovery:

♦Cap-and-trade legislation would increase the cost of coal-generated electricity, although analysts disagree on how quickly and how much costs would rise. In Indiana, which is largely dependent on coal for power generation, industrial expansion might seem like a poor bet if coal is going to become a much costlier way to make electricity, Hicks said.

♦The Employee Free Choice Act would make union organizing easier (or allow union intimidation, opponents say). Hicks said that could make employers more likely to locate new business in areas such as the southeastern United States with weaker organized-labor traditions.

♦Health care reform.