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Disappearing workers push Michigan’s August jobless rate down to 7.4%

Brian J. O’Connor
Detroit News Finance Editor

Michigan’s unemployment rate dropped by nearly half a point during August, falling from 7.7 percent to 7.4 percent. The number of unemployed workers dropped by 16,000 while the number of men and women holding jobs increased by 4,000.

That means that 11,000 workers left the state labor force, choosing to either retire, move out of state, give up looking for work, or by dying. State officials suggested the flooding in Metro Detroit after a torrential weekday rainstorm played a role.

“The Michigan jobless rate declined over the month primarily due to fewer unemployed individuals seeking jobs in August,” Jason Palmer, director of the Bureau of Labor Market Information and Strategic Initiatives, said in a statement. “Flooding in the Detroit metropolitan area may have curtailed job search activity for many in this region.”

The jobless numbers were released Wednesday afternoon by the Michigan Department of Technology, Management & Budget.

The new August jobless rate matches the April rate as the lowest so far for the year. The rate is 1.6 percentage points below the state’s August 2013 rate of 9 percent.

Overall for the past 12 months, the number of workers in the state holding jobs has increased by 91,000, and unemployment decreased by 74,000, indicating that 18,000 workers were added to the state labor force.

The jobless rate includes self-employed workers and independent contractors. The August survey of workers holding only nonfarm payroll jobs showed a loss of 10,000 jobs during the month, but a gain of 31,000 payroll jobs during the last 12 months.

Over time, the two surveys generally move in the same direction, despite monthly discrepancies. The small increase in total employment and the drop in payroll jobs suggests that jobs were scarcer during August.

The biggest payroll losses came in the retail sector, which lost 3,000 jobs, followed by losses of 2,000 jobs in the education and health sector, and the leisure and hospitality services segment. Only the manufacturing sector showed gains, of 2,000 jobs.