Unemployment in Some States Near Record Highs

The Bureau of Labor Statistics has released data on regional and state unemployment for September. Jobless rates remain uneven. Nevada's unemployment rate hit another high, and Michigan remained in second place. Plains states, including the Dakotas and Nebraska, had rates under 5%.

"Twenty-three states and the District of Columbia recorded unemployment rate decreases, 11 states registered rate increases, and 16 states had no rate change", the U.S. Bureau of Labor Statistics said as it compared numbers to August figures. "Twenty-nine states and the District of Columbia posted unemployment rate decreases from a year earlier, 16 states reported increases, and 5 states had no change."

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The largest over-the-month employment decreases were in California (-63,500), New York (-37,600), Massachusetts (-20,900), and New Jersey (-20,200). The largest over-the-month increases in employment occurred in the District of Columbia (+16,500), North Carolina (+10,100), Illinois (+8,600), Pennsylvania (+7,200), and New Mexico (+7,100)

Nevada's unemployment rate was 14.4% followed by Michigan's at 13% and California at 12.4%. North Dakota had a 3.4% jobless rate followed by South Dakota at 4.4% and Nebraska at 4.4%.

The number are unlikely to improve much in the hardest hit states anytime soon, particularly as compared to national averages. In Nevada, the decline in the gaming industry and construction is not likely to improve. Home prices in some parts of the state are down 50% from their 2006 peak. Foreclosures and defaults are the highest in the country. Perhaps most vexing, construction workers in Nevada cannot migrate to other parts of the US to get jobs because the real estate and construction industries remain depressed nationwide. Some economists suggest that construction and manufacturing workers should be retrained for other jobs, but that process would take years.

Michigan is the best example of a state where manfacturing jobs have been gutted -- and will almost certainly never return. The hundreds of thousands of layoffs at the auto companies and support businesses are largely permanent, as troubled US automakers have cut production and improved the efficiency of their plant operations.

Unemployment nationwide may fall below 9% next year and 8% in 2012, but there is no ready solution that will bring it down in areas where the economic base of goods and services businesses -- the industries that support a large number of jobs -- are permanently damaged.