State jobless rate below national average

Michigan’s economic recovery reached a new high after the unemployment rate in September bested the nation’s average for the first time in 15 years.

The state’s seasonally adjusted, monthly unemployment level, 5%, is slightly below the national average of 5.1%. It’s the first time that has happened since August 2000, when both the state and national unemployment rates were below 5%, Michigan officials said.

“We need to stay focused on our goal, but it also is important to look back to see how far we’ve come,” Gov. Rick Snyder said in a statement. “Michigan’s unemployment rate was once the worst in the United States.”

The governor added that “this means more people in Michigan are able to use their skills and are finding fulfilling jobs to support themselves and their families, making our cities and our communities stronger in a variety of ways.”

The new low is vast improvement over the state’s darkest days in 2009 during the Great Recession, when the unemployment rate approached 15%. But economists say there is still a potentially troubling gap in the number of adults who are working or actively looking for work versus those who have dropped out of the workforce altogether. The number of those no longer looking for work wasn’t immediately available.

Tim Bartik, a senior economist at the nonprofit, nonpartisan W.E. Upjohn Institute for Economic Research in Kalamazoo, cautioned that “statistical noise” can make a single month’s unemployment figure somewhat unreliable in pointing out a larger trend. But he added that looking at improvement in unemployment over the last year — 6.7% in September 2014 versus 5% in September 2015 — shows that “we’re doing a better job meeting the employment needs in the state.”

Total employment, according to the Michigan Department of Technology, Management & Budget, increased in September by 10,000, driven largely by gains in jobs in government and manufacturing. The number of unemployed people decreased by 7,000. The state’s workforce rose slightly, by 3,000 over the month.

Since the beginning of the year, Michigan’s employment picture has brightened as the nation’s rate has improved. “Monthly unemployment rates in the state and nation have been comparable, as have over-the-year payroll job growth rates,” Jason Palmer, director of the state Bureau of Labor Market Information and Strategic Initiatives, said in a statement.

The rate for the Detroit metropolitan region, 5.5%, remained above the state level as an increase in hiring locally appeared to have slowed a bit after strong gains.

Gains in September statewide were on pace with those in recent months. Michigan added 3,000 new jobs in August, and the state’s unemployment rate dropped by two-tenths of a percentage point to 5.1% — the lowest jobless rate recorded in Michigan since July 2001.

Since the start of the century, Michigan’s economy has been buffeted by job losses unseen by the rest of the country.

In August 2000, total employment in Michigan was 4.96 million people working, according to Bruce Weaver, an economic analyst with the state’s labor market information bureau. Today, he said, the number has fallen more than 400,000 to 4.5 million, or more than a 9% decline.

Don Grimes, senior research specialist at the University of Michigan, said Michigan was the only state to suffer a local economic downturn from 2000 to 2007, followed by a national recession starting in 2007. The decade-long contraction transformed the state from a relatively high income one to a relatively poor one, in large measure because of the decline of the Detroit Three automakers, he said.

The recent boom in auto sales, plus business tax cuts, have fueled an economic resurgence, he said. But “even this relatively strong job growth has not moved the needle much on Michigan’s ranking, in terms of average income,” Grimes said. “All the relatively good economy has done for Michigan is to stop its decline in relative terms.”

Michigan’s economic growth will continue to vary by region, influenced by auto manufacturing, according to a PNC economic outlook released this month. Universities, health care and alternative-energy research can help to establish a more balanced economy, the bank said. The housing market is improving, but a great deal of recovery is still needed, PNC said.