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Mich. improves to 2nd-worst state for unemployment

June 22, 2010

After more than four years at the bottom of the list, Michigan has shed the dubious distinction of being the state with the highest unemployment rate in the country.

Nevada took the top spot for the month of May with 14 percent unemployment, according to a report released Friday by the Bureau of Labor Statistics, a federal organization that tracks labor economics and other statistics.

Michigan had the second-highest rate with 13.6 percent unemployment, followed by California with 12.4 percent.

The unemployment rate takes into account citizens 16 years old or older who are looking for, and are available to work. It does not include those who have given up looking for work or those who would like to work full-time but are only employed part-time, which ultimately might affect overall percentages.

Michigan’s standing is the result of a full year of economic stabilization, MSU economics professor Charles Ballard said.

“Michigan’s unemployment rate has been inching downward for a whole year,” Ballard said. “After the ugliest nine months in the history of our state’s economy, we’ve now had a year where we’ve been stable and even improving a little bit. Regardless of where we stand relative to Nevada or other states, that’s not a blip. Michigan is showing some modest improvement and has been for a year.”

May’s unemployment statistics show a positive trend for Michigan, but the state still is economically shaky, said Bruce Weaver, an economic analyst with the Michigan Department of Energy, Labor and Economic Growth.

“It’s the lowest unemployment rate the state has had since May of last year,” Weaver said. “The rate has dropped by nearly a full percentage point since its peak, which was back in December of 2009 … But the rate is still very high. This is still a very high unemployment rate, (and) it’s still the case that competition for jobs is very, very high.”

Although Michigan has been improving, some of Michigan’s gain might be due to Nevada’s loss, Ballard said.

“I don’t know if Nevada has their worst times behind them,” Ballard said. “Their situation has continued to deteriorate in the last year, while ours has gotten a little better. Nevada was much more hard hit by the real estate meltdown than other places — they really overbuilt like crazy, so they have suffered a lot from property values going down.”

Since April, 37 states and the District of Columbia have experienced a decrease in unemployment rates. The national rate also decreased from 9.9 percent to 9.7 percent.
Some of Michigan and the U.S.’s growth also might have to do with temporary jobs provided by the U.S. Census Bureau, Ballard said.

“In the last month in Michigan, as in elsewhere, a part of the good news was temporary census jobs,” Ballard said. “There were temporary census jobs in Nevada, and they were not sufficient to keep their unemployment from going up.”

About 16,000 temporary jobs were created across the state to support the census, said Vincent Kountz, a partnership coordinator with the U.S. Census Bureau.

“Sixteen-thousand jobs in the workforce, although it’s temporary … could have had an impact (on the unemployment rate),” Kountz said.

However, most of those jobs are ending this month, Kountz said, and the boost could be short-lived.

Although Michigan might hover around the bottom of the unemployment ranking for many months to come, climbing out of the last-place position is important because it boosts statewide morale, Ballard said.

“I think just psychologically, it’s nice to not be the highest unemployment in the whole country,” Ballard said. “It kind of wears on you to be the worst in the country. The worst is behind us, for Michigan, at least for now.”

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