Mich. jobless rate falls to lowest level since 2001

Brian J. O'Connor
Detroit News Finance Editor

Michigan’s unemployment rate dropped to its lowest level since July 2001 during August, dropping by two-tenths of a point to 5.1 percent.

The state’s total employment — including self-employed workers, contractors and freelancers — stands at it highest level since August 2008, while the number of payroll workers is the largest since spring of 2007. Nearly 4.5 million Michiganians hold some job, including nearly 4.3 million working on company payrolls.

According to data released Wednesday by the Department of Technology, Management & Budget, 8,000 workers found jobs during the month, 7,000 left the jobless rolls, and 1,000 men and women joined the state labor force. The rate is the lowest for the state since July 2001. The new rate is 1.7 percentage points below the state’s August 2014 rate of 6.8 percent.

August was the second month in a row that Michigan matched the national jobless rate, and the fourth time this year. When Michigan first matched the national rate, in March, it was the first time in nearly 15 years. At one point, the gap between the state and U.S. rates was as much as 5.4 points.

“This would be the lowest unemployment rate so far in 2015,” said Bruce Weaver, economic analyst with the Michigan Department of Technology, Management & Budget. Both the total number of payroll jobs and total employed, are at the highest level of the year. “Over the year, Michigan has added 91,000 payroll jobs, which is a 2.2 percent increase from August to August.”

The growth in payroll jobs has been slowing in the last few months, however.

“The payroll jobs data has been showing a lot of growth over the last year, but it’s been relatively flat over the last three months,” Weaver noted.

The biggest gains in the last 12 months have come in the professional and business services segment, which added 26,000 jobs; manufacturing, which added 21,000 jobs; and education and health care, which added 17,000 workers. The only losses were 3,000 jobs in the information sector, and 8,000 government jobs.

While the improvements are welcome, the overall jobs picture is still troubled in both Michigan and the country because a significant portion of workers aren’t looking for a job, and have simply dropped out of the labor market.

Compared with 2007, about 300,000 workers in Michigan aren’t working and aren’t looking for a job. Some are students who have delayed getting a job or workers who decided to opt out of looking and simply retire early. Another portion is that of workers older than 50, primarily men without college education, who’ve lost the good-paying factory jobs that have vanished from the state, and can’t find new work. If those drop-out workers were counted in the calculation of the state jobless rate, it would nearly double, according to state data.

In addition, wages haven’t improved much in the last 12 months. Average weekly earnings in the manufacturing sector improved by just $7.97 since August 2014, and dropped by $32.62 a week in the transportation equipment segment.


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