The town dubbed the "Carpet Capital of the World" is now grappling with a more dubious distinction: The city has lost more jobs per capita in the past year than any other in the U.S.

The U.S. Bureau of Labor Statistics says Dalton lost 4,600 jobs between June 2011 and June 2012. Most were in industries like construction and transportation — businesses that were struggling after Dalton's carpet-based businesses were forced to shut down or scale back when the housing market collapsed.

However, city officials say the numbers don't tell the full story. They say that if state and national economies improve, Dalton will follow. Mayor David Pennington says despite tough times, Dalton is doing well. New industries are sprouting, as well as new retail outlets such as Kohl's.

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