MORGANTOWN, W.Va. — West Virginia’s unemployment rate continues to climb at a time when many other states are reporting post-recession economic improvements.

In June, after six months of increases, West Virginia’s unemployment rate hit 7.4 percent, making it the highest in the U.S., according to the U.S. Bureau of Labor Statistics. Many of the job losses have been in the mining, construction and hospitality industries.

Dr. John Deskins, director of the Bureau of Business and Economic Research within West Virginia University’s College of Business and Economics, is predicting coal — one of the main drivers of the Mountain State’s economy — will eventually stabilize after seeing a production drop of one-third during the past decade.

Coal, Deskins said, will continue to be a key part of the U.S. energy plan while demand for coal is still increasing internationally, but coal alone, Deskins maintained, cannot determine West Virginia’s economic future.

“We want industrial diversification. We want to grow other parts of our economy, whether coal does well or bad,” he said. “Even if coal does well, we want to grow manufacturing and construction and leisure and hospitality and other sectors.”

That may be difficult for many reasons. Deskins noted the creation of new businesses annually in West Virginia is down “dramatically” from the 1990s and 2000s, though he could not identify why specifically.

“It’s just a pattern that I have noticed. It’s a pattern that is apparent here in West Virginia and it’s true for other states as well,” he said of what is a national trend. “Part of it is still a remnant of the recession. Part of it is, perhaps, due to demographic issues, but I don’t know all the reasons.”

Deskins said the most important factor for the state’s economy now and in the future remains human capital.

“No matter how good your tax climate is, no matter how good your roads are — those are important — but no matter how good they are, if a business cannot find the workers that it needs, it’s not going to come here,” he said of potential developments from inside and outside of the West Virginia.

“We’re way short (on human capital) and it’s a major problem and I think it does come first above taxes and infrastructure and those other issues.”

Workforce improvements will come out of investments in health and education, along with new policies aimed at bettering the business climate.

“I would say, we want to focus on making our state as business friendly and as attractive to businesses as possible, no matter what happens to coal,” Deskins said.

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