Payrolls Climb in 29 U.S. States, Led by California

Payrolls increased in 29 states in June, while 21 lost jobs, indicating limited progress in the U.S. labor market.

The unemployment rate rose in 27 states, fell in 11 and the District of Columbia, and was unchanged in 12. California led the nation with a 38,300 gain in employment, followed by Ohio with an increase of 18,400 jobs, the Labor Department reported today in Washington.

Companies last month added the fewest workers in almost a year, concluding the worst quarter for corporate hiring since the first three months of 2010, according to July 6 figures. Employment in the three-year economic expansion has been slow to recover in some states that are contending with weaker housing markets or industries.

“We see a lack of diversity in some of the economies,” Michael Brown, an economist at Wells Fargo Securities LLC in Charlotte, North Carolina, said before the report. “That puts them at risk for cyclical swings. Not only do you have economic fundamentals at work, you have demographics at work.”

Alabama and New Jersey showed the biggest increases in unemployment. The rate in Alabama climbed to 7.8 percent in June from 7.4 percent the prior month. New Jersey’s unemployment rate jumped to 9.6 percent in June, the highest in almost two years, from 9.2 percent as more people entered the labor force looking for work.

Nevada Joblessness

Nevada continued to have the nation’s highest unemployment rate, at 11.6 percent. Rhode Island was second, with a rate of 10.9 percent, followed by California at 10.7 percent.

North Dakota had the lowest unemployment in the nation, at 2.9 percent, followed by Nebraska at 3.8 percent.

States showing the largest decreases in employment were Wisconsin, Tennessee and Maryland.

Stocks fell, halting a three-day rally for the Standard & Poor’s 500 Index, amid concern Europe’s debt crisis is worsening. The S&P 500 dropped 0.7 percent to 1,367.59 at 11:26 a.m. in New York.

State and local employment data are derived independently from the national statistics, which are typically released on the first Friday of every month. The state figures are subject to larger sampling errors because they come from smaller surveys, making the national figures more reliable, according to the government’s Bureau of Labor Statistics.

Private Employment

Employers nationwide added 80,000 jobs last month, after 77,000 in May, Labor Department data showed on July 6. Private payrolls climbed 84,000 in June, the weakest in 10 months.

The U.S. unemployment rate, which held at 8.2 percent in June, has been 8 percent or higher since February 2009.

New York’s jobless rate rose to 8.9 percent from 8.6 percent in May. In New York City, unemployment climbed to 10 percent, matching a post-recession peak reached in the six months through February 2010, from 9.7 percent, a report showed July 19.

Morgan Stanley (MS) is among some financial firms reducing headcount as revenue from investment banking and trading falls. The bank said yesterday that it will eliminate more than 700 jobs by the end of the year, bringing 2012 reductions to 4,000.

Presidential Race

The labor market become a centerpiece of this year’s presidential campaign, with President Barack Obama and Republican challenger Mitt Romney sparring over who can best revitalize the recovery. Since World War II, Ronald Reagan was the only president re-elected with a jobless rate higher than 6 percent.

Of the eight battleground states that stand to determine the election’s outcome -- Colorado, Florida, Iowa, Nevada, Ohio, Pennsylvania, Virginia and Wisconsin -- five had unemployment rates lower than the overall U.S. and two had higher joblessness, while one was the same as the national rate.

Unemployment is an “enormous” problem and its costs “are very, very high,” Federal Reserve Chairman Ben S. Bernanke told lawmakers this week.

“Given that growth is projected to be not much above the rate needed to absorb new entrants to the labor force, the reduction in the unemployment rate seems likely to be frustratingly slow,” Bernanke said.

To contact the reporter on this story: Lorraine Woellert in Washington at lwoellert@bloomberg.net

To contact the editor responsible for this story: Christopher Wellisz at cwellisz@bloomberg.net

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