Jobs (and the nightlife) are magnets for Nevada.

Photographer: David Paul Morris

Some States Have All the Jobs

Justin Fox is a Bloomberg View columnist. He was the editorial director of Harvard Business Review and wrote for Time, Fortune and American Banker. He is the author of “The Myth of the Rational Market.”
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In November, for the 24th consecutive month, fewer than half of West Virginians aged 16 and over had jobs. It is the only state where this is the case, according to data released today by the Bureau of Labor Statistics. And unlike in most other states, the job situation in West Virginia shows no real signs of improving. With its signature industry, coal mining, in deep decline, this economic recovery is passing the state by.

Nationwide, the employment-to-population ratio for November was 59.3 percent, up from a low of 58.2 percent (which it hit several times from 2010 to 2013), but still far below the all-time high of 64.7 percent in April 2000. Back then, the ratio was among the world's highest. Now it lags behind that of most other developed nations. West Virginia is not the only state dragging the ratio down:

Here are the states pulling the ratio up:

Overall, Midwestern and Plains states have the highest employment-to-population ratios, Southern states the lowest.

There are of course other, more frequently used, labor-market measures than the employment-to-population ratio. But they have their flaws. Take the unemployment rate, which only counts people who are actively looking for work.

West Virginia's November unemployment rate of 6.5 percent is tied with Nevada's for third-highest in the country, after New Mexico's 6.8 percent and the District of Columbia's 6.6 percent.

But looking for work in the District of Columbia is an activity with a good shot of paying off -- employment is up 60,497 in the District since bottoming out in May 2009. In West Virginia it is not -- employment is down 16,584 since May 2009. Clearly, D.C. has a healthier job market than West Virginia does, and D.C.'s employment-to-population ratio of 65.6 percent reflects that better than its unemployment rate does.

On the other hand, a problem with the employment-to-population ratio as calculated by the BLS is that states with lots of senior citizens score especially low. Florida, for example, had the highest percentage of 65-and-older residents in the 2010 census, at 17.3. West Virginia ranked No. 2, at 16 percent, but that's less because seniors flock there (as they do to Florida) than that working-age people have left. They've had reason to leave for a long time -- West Virginia has had the country's lowest employment-to-population ratio for decades. Here's where things stood at the start of the BLS series in 1976:

It is remarkable how persistent these rankings are. Almost all the states in the top 5 and bottom 5 back then are within 15 places of the top and bottom now. The big exception is the former No. 1, Nevada, which has fallen to 34th place among the 50 states plus the District of Columbia, with an employment-to-population ratio of 59.2. Along the way, though, the state's population has quintupled -- there are lots more jobs in Nevada than there used to be, just not quite enough of them. New York made a less dramatic but still substantial move in the other direction, up from third from the bottom to 16th from the bottom in November, with a ratio of 57.9 percent.

Most of this rise can probably be chalked up to New York City, which gets its own spot in the BLS state data releases, as does Los Angeles County. In 1976, New York City's employment-to-population ratio was below 50 percent and barely above that of West Virginia. Lately, though, it has been taking off:

New York City's experience demonstrates that labor market improvement is possible; West Virginia's that it is hard.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

To contact the author of this story:
Justin Fox at justinfox@bloomberg.net

To contact the editor responsible for this story:
Paula Dwyer at pdwyer11@bloomberg.net