2003 Average Unemployment Rises

January 23, 2004
| By Katy Rent |
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LANSING — The Michigan Department of Labor & Economic Growth announced that Michigan’s seasonally adjusted unemployment rate in December edged upward by one tenth of a percentage point to 7.2 percent from November’s 7.1 percent.

Employment fell by 31,000 and unemployment increased by 4,000 as the state civilian labor force recorded a reduction of 26,000, said Bruce Weaver, acting director of the office of labor market information for the MDL&EG.

December was the seventh consecutive month that the state’s unemployment rate was above 7 percent and was the lowest level recorded in 2003.

“December closed out another difficult year for Michigan’s labor market,” Weaver said. “Last year marked the third year in a row that the state’s annual jobless rate increased.”

The state’s December jobless rate was a full percentage point higher than the December 2002 rate of 6.2 percent and Michigan’s unemployment rate was well above the national rate of 5.7 percent. The state’s jobless rate has been above the U.S. rate for more than three years.

Over the year, unemployment nationwide decreased slightly by a little more than 3 percent, while joblessness in Michigan increased by almost 19 percent.

From the third quarter to the fourth quarter of 2003, Michigan’s unemployment rate edged downward by one-tenth of a percentage point from 7.4 to 7.3 percent. This was the first quarterly jobless rate decline since the first quarter of 2000. Over the quarter, the labor force and the number of people employed in the state were essentially unchanged, with the number of unemployed decreasing slightly by 7,000.

Michigan’s 2003 preliminary annual average unemployment rate was 7 percent. This was an increase of eight-tenths of a percentage point over the 2002 annual average unemployment rate of 6.2 percent, and it was the highest annual jobless rate since 1993.

Last year was the third consecutive year that the state’s annual average unemployment rate increased, nearly doubling from 2000. Prior to 2001, Michigan’s annual average unemployment rate declined nine years in a row.

The state’s annual average unemployment level increased in 2003 by 48,000 or almost 16 percent over the 2002 level. As a point of comparison, the number of unemployed in the state rose 14 percent from 2001 to 2002 and by 48 percent from 2000 to 2001.

The average number of weeks individuals remained unemployed in Michigan also increased from 15 weeks in 2002 to 20 weeks in 2003.

According to the monthly survey of employers, seasonally adjusted Michigan payroll jobs in December fell by 33,000 to total 4,372,000. Payroll job losses were widespread throughout most industry sectors, but were led by decreases in trade, transportation, and utilities, which lost 14,000, and professional and business services, losing 9,000.

Other notable declines occurred in government, which lost 4,000, education and health services, losing 4,000, other services, which lost 3,000, and manufacturing, losing 2,000. Slightly offsetting these declines was an employment increase in construction by 2,000. The remaining industry sectors recorded little change. December’s payroll employment total was the lowest for the state in 2003.

Payroll jobs in Michigan fell by 79,000, or 1.8 percent, since December 2002. In that period, nine of the 11 major industry sectors within the state recorded declines. Two major industry categories, the education and health services sector and the financial activities sector, were the exception. These divisions posted small gains over the year.

From December 2002 to December 2003, the majority of payroll job losses were confined to five industry sectors: manufacturing, which lost 30,000, government, losing 20,000, professional and business services, down by 16,000, trade, transportation, and utilities, which lost 12,000, and other services, losing 9,000.

Four industry sectors — leisure and hospitality services, construction, natural resources and mining, and information — remained relatively stable over the year.           

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