By Shobhana Chandra
July 17 (Bloomberg) -- Georgia and Alabama in June were the latest U.S. states to exceed 10 percent unemployment and Michigan’s rate topped 15 percent, as the worst job slump in the postwar era deepened.
The total number of states with at least 10 percent joblessness rose to 15, the Labor Department reported today in Washington. Six states reached their highest level of joblessness since records began in 1976.
Employers are trimming positions and delaying hiring even as reports show housing and manufacturing are stabilizing. The U.S. has lost about 6.5 million jobs since the recession began in December 2007. President Barack Obama and economists surveyed by Bloomberg News say national unemployment will reach 10 percent this year.
“No region of the U.S. is immune to the job destruction that’s going on,” said Rebecca Braeu, an economist at John Hancock Financial Services in Boston. “The rising unemployment rate is clearly going to hurt consumption. It’ll limit the recovery.”
Payrolls in the world’s largest economy fell by 467,000 last month, more than forecast, while the jobless rate jumped to 9.5 percent, the highest level in 26 years. The rate will reach 10 percent by yearend and average 9.8 percent for 2010, according to the Bloomberg survey.
The states reaching record jobless rates in June were Georgia, Nevada, Rhode Island, South Carolina, Florida and Delaware.
California, Michigan
California’s jobless rate held at a record 11.6 percent for a second month. Unemployment in the District of Columbia also exceeded 10 percent, reaching 10.9 percent in June.
Michigan, the heart of the U.S. auto industry, jumped to 15.2 percent from May’s 14.1 percent.
General Motors Co. and Chrysler Group LLC have emerged from bankruptcy, and economists predict the slump in auto production may ease as government efforts to stoke consumer spending, including cash payments aimed at reviving car sales, take hold.
The financial sector continues to bleed jobs. New York City’s unemployment rate jumped to 9.5 percent in June, the highest level since 1997, while the state jobless rate rose to 8.7 percent from 8.2 percent in May, figures showed yesterday.
Growth Forecasts
Improving home sales and smaller declines in manufacturing have caused economists to raise projections for growth. Growth will average 1.5 percent in the July-to-December period, helped by stabilization in consumer spending, which accounts for about 70 percent of the economy, the Bloomberg survey showed.
Even so, Americans without jobs aren’t optimistic.
“I don’t think the economy is turning around,” said Gary Lucas, 32, of Atlanta, who was laid off six months ago from a job installing fire-protection sprinklers in buildings. “I don’t see it yet.”
Lucas said he has put out more than 30 applications with only a few expressions of interest.
Amanda Wright, a certified nurse’s assistant, said she’s been searching for work since 2007, “but nobody is biting.” Wright, 22, was unable to get enough financial aid to complete a course in nursing radiology when she returned to school this year, and is tapping her savings and using discounts she gets through her mother’s government job to put her one-year-old son in daycare.
“I’ve registered with all the unemployment offices and temp agencies, but nobody calls,” said Wright, who also has certifications in customer service and data entry and is looking for jobs in Alabama and elsewhere in Georgia. “The most frustrating part is sitting by the phone, the waiting.”
To contact the reporter on this story: Shobhana Chandra in Washington at schandra1@bloomberg.net
Last Updated: July 17, 2009 10:43 EDT
HOME
