FRANKLIN—Area unemployment rates are continuing to climb, largely because of the recent closure of the International Paper Co. paper mill in Franklin.

According to data from the Virginia Employment Commission, the unemployment rate in the City of Franklin rose to 12.1 percent in May, the most recent month for which figures are available. Unemployment in the city stood at 11 percent in April, and was at 9.9 percent in May 2009.

Southampton and Isle of Wight counties also saw their unemployment rates go up. In Southampton, unemployment was 9.5 percent in May, up from the 8.9 percent rate it had in April and 8.4 percent from last May. Isle of Wight’s rate was 7.1 percent, up from the 6.5 percent rate in April and 6 percent from one year ago.

“It is predominantly mill driven,” Nancy Parrish, manager of the Franklin Business Incubator, said Friday of the local unemployment figures. “We knew that with the mill winding down those numbers would grow. Hopefully they should level off and start dipping soon because some of the mill workers have found new jobs.”

The VEC said the state unemployment rate was 6.9 percent in May, a slight increase from the 6.7 percent rate reported for April. The rate was also 6.7 percent last May.

Don Lillywhite, director of labor market information for the VEC, said Friday that he believed the state unemployment rate went up because about 10,000 to 12,000 people started looking for jobs.

“People that had been out of the labor force, that had not even been counted as unemployed, began to slowly come back in,” Lillywhite said. “Some began looking for jobs again when they hadn’t for quite some time because they sensed that there might be a little better opportunity.”

He predicted that the state unemployment rate could continue to climb in the months ahead.

“Generally in the summer it does go up a little bit,” Lillywhite said. “We’re going to get a much bigger hit next month with the census workers; most of them will be unemployed.”

The U.S. Bureau of Labor Statistics reported Friday that the national unemployment rate fell to 9.5 percent, down from 9.7 percent in May. The private sector created 83,000 in June, but employment still declined by 125,000 jobs overall, largely because of the loss of 225,000 temporary jobs for conducting the national census.

“While this steady private sector job growth is encouraging, the large number of Americans without a job reminds us we need to continue working to create jobs and grow the economy,” U.S. Secretary of Labor Hilda Solis said in a written statement Friday.

The federal data showed that the number of long-term unemployed — workers who have been without a job for 27 weeks or more — stood unchanged at 6.8 million, and made up 45.5 percent of the total unemployment rate.

There were also about 2.6 million people described as “marginally attached” to the labor force. The designation is made for people who were not in the labor force, wanted and were available for work, and had looked for a job sometime in the last 12 months. Marginally attached workers are not counted as unemployed because they had not searched for work in the last four weeks.

Of the marginally attached workers, 1.2 million were classified as “discouraged workers,” meaning they were not currently looking for work because they believe no jobs are available to them.

That figure will apparently include some local workers.

“A lot of people knew their jobs were ending in May or June,” Parrish said. “Some told me they were going to take the summer off; they were not in any real hurry to start looking for a job. And there are several who are going back to school.

“Both of those groups of people are going to be part of the (unemployment) numbers for a while.”