State's December jobless rate falls

January 24, 2011
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Michigan’s seasonally adjusted unemployment rate in December dropped over the month by seven-tenths of a percentage point to 11.7 percent, according to data released by the Michigan Department of Energy, Labor & Economic Growth. Unemployment fell by 42,000; however, total employment edged upward by only 5,000. This resulted in a 37,000 reduction in the state’s labor force over the month.

The Michigan jobless rate in December was nearly three full percentage points below the December 2009 rate of 14.5 percent. The national jobless rate decreased by half a percentage point over this period. The U.S. unemployment rate declined by four-tenths of a percentage point over the month to 9.4 percent in December.

The drop in the state’s December jobless rate primarily reflected a reduction in the number of unemployed individuals seeking jobs. Employment levels in Michigan have been flat since the summer. Overall in 2010, Michigan’s labor market stabilized after one of the worst labor market years on record in 2009.

Monthly labor force trends and highlights

  • Michigan’s jobless rate declined in December for the fourth consecutive month. The rate fell for 10 of the last 12 months, and remained unchanged in March and August.

  • Michigan’s December unemployment rate was its lowest since the January 2009 rate of 11.3 percent.

  • The state’s total employment level has changed little since July, in contrast to the first half of the year when it rose steadily.

  • During the second half of 2010, reductions in the number of unemployed have been primarily due to fewer state residents seeking jobs. Labor force levels have dropped steadily since May.

  • From December 2009 to December 2010, the number of unemployed in Michigan fell by 20.6 percent. Unemployment nationally declined by 4.8 percent over the same period.

Michigan’s preliminary annual average unemployment rate in 2010 was 13.1 percent. Total employment averaged 4,199,000 in 2010, while unemployment averaged 632,000. The state’s annual labor force level was 4,831,000.

  • Michigan’s annual average unemployment rate in 2010 declined by a half percentage point from the 2009 annual rate of 13.6 percent. The national 2010 unemployment rate was 9.6 percent, up three-tenths of a percentage point from the 2009 average.

  • 2010 marked the first decrease in Michigan’s annual jobless rate since 2005.

  • The state’s 2010 preliminary annual jobless rate was the fourth highest recorded since 1976. The highest annual rates over this period were: 15.6 percent in 1982, 14.6 percent in 1983 and 13.6 percent in 2009.

  • From annual 2009 to 2010, the number of unemployed declined in Michigan by 33,000 or 4.9 percent. However, total employment levels also fell by or 0.6 percent.

  • The state’s labor force dropped by 57,000 or 1.2 percent during 2010.

  • Long-term unemployment rose in Michigan from 2009 to 2010. Individuals out of work for 27 weeks or more increased from 41 percent of the unemployed in 2009 to about 50 percent of the unemployed in 2010. Average weeks unemployed also increased as unemployment duration rose from an average of 30 weeks in 2009 to 40 weeks in 2010.

According to the monthly survey of employers, seasonally adjusted Michigan payroll jobs were little changed in December, declining slightly by 7,000 to 3,832,000. Minor job reductions were recorded in trade, transportation and utilities (-3,000) and manufacturing (-3,000), while lesser declines were posted in several other industry sectors. Somewhat offsetting the decreases was a net gain of 3,000 jobs in leisure and hospitality services. The state’s remaining major industry sectors were essentially unchanged in December.

  • Michigan’s overall payroll job count has been relatively steady since August.

  • Payroll job levels from August through December were lower than the levels posted in the state from April through July.
  • Although recording a small job decline in December, employment in transportation equipment manufacturing was relatively steady throughout 2010.

  • Jobs in the financial activities sector reported large job losses throughout 2009 and into early 2010. Since March 2010, this sector has stabilized.

  • With a minor decline in December, government jobs decreased for the fifth consecutive month.

  • From December 2009 to December 2010, payroll jobs in Michigan edged down by 13,000 or 0.3 percent. Over this period, the vast majority of job loss was recorded in government (-15,000).

  • Since December 2009, overall jobs in Michigan’s private sector were up slightly. Over the year, significant job gains were confined to the manufacturing sector (+11,000), while the only notable private sector job losses occurred in financial activities (-5,000) and information (-3,000).

  • Seasonally adjusted average weekly hours and earnings of production workers in manufacturing declined over the month. Over the year, earnings increased slightly, however hours declined.

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

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