Employment remains the key to the economy's turnaround. But a new report on state-by-state employment shows just how difficult it is to get job markets in 50 different states moving forward at the same time.
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On August 17 the Bureau of Labor Statistics released its Regional and State Employment and Unemployment report for the month of July. Here's an example of how paradoxical conditions seem these days: While the report showed that the number of jobs was up in most states, it also showed that the unemployment rate was up in most states.
When the big picture conclusions are that contradictory, it takes a little sifting to get to the meaning of an economic report. Employment conditions matter to more than just job seekers. Putting more people back to work means conditions for businesses should improve as consumers have more money to spend, and savers should profit as interest rates on CDs, savings accounts and other deposits can start to rise again.
With so much riding on employment, here are some highlights from the recent report:
- Improvement is inconsistent from state to state. So much economic reporting refers to conditions on the national level, but the fact is that each state has its own distinct economy, often with very differing sets of conditions. For example, total employment increased in 31 states in July, with California, Michigan, and Virginia leading the way by adding over 20,000 new jobs apiece. At the same time, 19 states saw a net loss in jobs, with New Jersey getting the worst of it by losing 12,000 jobs.
- The West is not the best. Similar differences are apparent if you look at the country regionally. The unemployment rate is worst in the West, at 9.4 percent. It is significantly better -- though still unacceptably high -- in the Midwest, at 7.5 percent.
- Some troubled areas are making progress. Again, some areas have it much worse than others, but at least there are signs of improvement in some trouble spots. For example, California and Nevada continue to suffer two of the highest unemployment rates in the nation, but each has also been among the leaders in reducing unemployment over the past year.
- More people are looking for work again. Now back to that paradox: 31 states added jobs in July, yet the unemployment rate increased in 44 states. The number of jobs and unemployment rate can only rise at the same time if more people are joining the labor force. In part, this may be due to more people becoming encouraged enough to start looking for work again, which could be a sign of grass-roots optimism for the economy.
Because it showed net job creation, the overall message of the July state-by-state employment report was positive, but only mildly so. It will take less of a mixed message to help a meaningful number of unemployed people, let alone business conditions and deposit interest rates.
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The original article can be found at Money-Rates.com:
The jobs paradox