Michigan's October jobless rate declines

November 30, 2009
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Michigan’s seasonally adjusted unemployment rate in October edged downward by two-tenths of a percentage point to 15.1 percent, according to data released by the Michigan Department of Energy, Labor & Economic Growth. Total employment increased by 22,000 while unemployment dipped by 6,000, as the state’s labor force advanced by 16,000 over the month.

The U.S. unemployment rate in October increased by four-tenths of a percentage point to reach 10.2 percent.

Michigan’s October 2009 jobless rate was six percentage points above the state’s October 2008 rate of 9.1 percent. In the same period, the national jobless rate increased by three and six-tenths percentage points.

Michigan’s jobless rate remained near 15 percent, where it has been since June. However, modest job gains were recorded in October in construction and health care.

Jobs also spiked in October in professional and business services (+25,000), but this increase is likely overstated due to a shift in seasonal employment patterns in the industry.

After three consecutive months of labor force decline, Michigan’s work force rebounded with a gain of 16,000 in October 2009.

Total employment in Michigan advanced by 22,000 to reach 4,116,000. This was the first time since May 2007 that total employment has increased in the state.

Michigan’s average unemployment rate for the first 10 months of 2009 was 13.9 percent. The state’s 2008 annual rate was 8.4 percent.

Since October 2008, unemployment in Michigan increased by 284,000 or 63.3 percent.  Unemployment nationally rose by 53.6 percent over this period.

According to the monthly survey of employers, seasonally adjusted Michigan payroll jobs increased in October 2009 by 39,000 to total 3,860,000. Job gains over the month were recorded in professional and business services (+25,000), education and health services (+11,000), and construction (+5,000).

Since July 2009, professional and business sector jobs have increased by 6.7 percent due in part to the privatization of education related jobs from the local government sector.  Employment in local government has declined by 4.4 percent over the same time period.

In October, a modest job addition was also recorded in manufacturing (+3,000). Job cuts in leisure and hospitality services (-4,000) and trade, transportation and utilities (-3,000) slightly offset the gains recorded over the month.

Nonfarm payroll jobs in Michigan rose to 3,860,000 in October 2009. Since July 2009, total jobs have stabilized, reversing the trend of significant job losses in the first half of the year.

Professional and business services increased for the second consecutive month in October 2009, climbing to 512,000. This job gain may be overstated as the impact of the privatization of educational support workers caused a seasonal employment shift in the sector.

Manufacturing jobs in the state edged up for the fourth consecutive month, rising to 464,000.

Trade, transportation and utilities jobs have declined steadily since October 2008. Nearly 61,000 jobs have been lost over the year, with half the job losses occurring in retail trade.

Education and health services reversed the job trend from the prior two months and registered a job gain in October 2009. Over the year, this job category remains the only major sector in the state to post job growth.

From October 2008 to October 2009, payroll jobs in Michigan fell by 263,000, or 6.4 percent. Since October 2008, every major industry sector in the state, excluding education and health services, recorded significant job loss.

Seasonally adjusted average weekly hours and earnings of production workers in manufacturing increased over the month. Both average weekly earnings and average weekly hours rose over the year.

Rick Waclawek is director of DELEG’s Bureau of Labor Market Information and Strategic Initiatives.

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