WASHINGTON (Reuters) - Unemployment rates dropped in more than half of U.S. states in October from a year earlier, according to a government report released on Tuesday that showed improvement in the jobs market continues to vary across the United States.

A woman fills out job application forms as she attends a job fair for military veterans and other unemployed people in Los Angeles, October 7, 2010. REUTERS/Lucy Nicholson

Jobless rates dropped in 29 states and the District of Columbia from October 2009, rose in 16 states and were unchanged in a further five, the U.S. Labor Department said.

On a monthly basis, unemployment rates decreased in 19 states and the District of Columbia between September and October, increased in 14 states and remained the same in 17 states.

The Liscio Report, an economic newsletter that tracks states’ economic conditions, said “it’s encouraging to see some positive momentum in state detail”.

The recession that began in 2007 and officially ended in 2009 divided the states’ economic fortunes.

North Dakota and South Dakota had the lowest unemployment rates throughout the recession, mostly due to prosperous natural resource sectors.

Western states hit hard by the housing bust had some of the highest rates, with the automobile industry downturn also pushing Michigan’s rate up.

That pattern remained in place during October.

North Dakota had the lowest unemployment rate at 3.8 percent, followed by South Dakota at 4.5 percent and Nebraska at 4.7 percent.

Nevada had the highest unemployment rate among states, at 14.2 percent, followed by Michigan at 12.8 percent and California at 12.4 percent, which matched the record high the Golden State reached in March. For 21 straight months, California’s jobless rate has been above 10 percent.

The Michigan jobless rate, which was lower than the state’s rate of 14.4 percent in October 2009, “continued the relatively stable trends seen throughout 2010,” said Rick Waclawek, director of the state’s labor market information office, in a statement.

The national unemployment rate was 9.6 percent in October. Analysts expect a government report next week to show the rate remained the same in November.

According to the Labor Department, 27 states posted jobless rates significantly lower than the U.S. rate, five states had “measurably higher rates,” and 18 states and the District of Columbia “had rates that were not appreciably different from that of the nation.”

Almost all states, 41, added jobs in October from September, the Labor Department said. Texas gained the most positions, 47,900 since September, followed by New York at 40,600 jobs, and California at 38,900.

Delaware lost the most jobs over the month, 3,000, followed by Missouri, which shed 2,900.