Michigan jobless rate drops to lowest level since 2001

Brian J. O'Connor
Detroit News Finance Editor

Michigan’s statewide unemployment rate dropped by two-tenths of a percentage point during January, dropping from 5.1 percent to 4.9 percent, adding 33,000 jobs and drawing 27,000 men and women into the state workforce. Overall, unemployment for the month fell by 6,000 workers.

“This is the first time the state rate has been under 5 percent since June of 2001,” said Bruce Weaver, economic analyst with the Michigan Department of Technology, Management & Budget.

Weaver added that the size of the state labor force and total employment isn’t back up to those levels, however. The labor force is smaller by 329,000 workers than in June 2001, and total employment in the state is down by nearly 314,000 jobs. Nonetheless, Weaver added, “We’ve seen fairly strong labor force growth lately. The state added about 50,000 to the labor force since September.”

The improvement shows encouraging strength in hiring because the number of workers joining the labor force were all able to find jobs, as well as a few thousand jobless workers.

The state also released the average annual unemployment rate for 2015 on Wednesday, which fell to 5.4 percent for the year, down from 7.3 percent for 2014 and a revised 8.8 percent for 2013.

After posting a significant gap between the state and federal jobless rates during 2014, the difference diminished during 2015 and Michigan has mostly matched the national unemployment rate since May. “One year ago the state’s rate was about a half of a percentage point above the national rate, but in January Michigan matched the national rate,” Weaver said.

The state’s total of payroll jobs reported by employers also improved during January, growing by 19,000 jobs. The state jobless rate is based on the larger household survey, which includes contractors and self-employed workers as well as those holding payroll jobs. That job level is back to where it was during 2006, Weaver noted, with 87,000 non-farm payroll jobs added in the state since January 2015.

During 2015, 60 percent of all job growth in the state came from four sectors: manufacturing, accommodation and food services, professional and business services, and health care. “Those four broad sectors account for six out of 10 job gains since last January,” Weaver said.

For January, the biggest payroll job gains came in manufacturing and in the leisure and hospitality sectors, which both added 5,000 jobs. The only loss was 1,000 jobs in the information services sector.


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