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Is Worst of Job-Market Blues Over For Hardest Hit States?

Fewer states reported unemployment-rate increases in September than the previous four months, signaling a turning point may be near, according to a government report Wednesday.

Woman filing for unemployment
Woman filing for unemployment

In September, 23 states and the District of Columbia posted a rise in unemployment rates on a month-to-month basis, vs. a total of 27 and the capital district in August, according to the Bureau of Labor Statistics. In the previous four months, an average of 35 states posted increases.

Another 19 states showed a decline in rates—versus 16 in August—which was also the most in five months. Eight states saw no change in September.

Even hard-hit Michigan, with the highest rate in the country offered reason for hope. Though the jobless rate rose from 15.2 percent in August to 15.3 percent in September, the lever has has been hovering around 15 percent since June, a sign that the situation is leveling off, according to the state's Department of Energy, Labor and Economic Growth.

“The state jobless rate, which rose sharply by five percentage points from December 2008 to June 2009, has stabilized somewhat since June,” said Rick Waclawek, director of DELEG’s Bureau of Labor Market Information and Strategic Initiatives in a statement.

Christina Bristow, the Michigan regional operations manager at Adecco, a worldwide hiring firm, has seen an increase in the hiring of temporary workers in the state, a development that typically precedes full time hiring by six months.

“What we’re seeing—starting in August—is an increase in positions coming in,” said Bristow, who oversees 14 offices in Michigan. “Manufacturing is the main industry that we’re seeing the growth in.”

Although hiring is down from last year, Bristow said, the last two months have shown growth, signaling that companies are beginning to hire again. In downturns, she added, companies lay off their temporary workers first and then rehire them first when the economy begins to improve.

The modest, but nevertheless welcome, improvement comes as national labor market trends continue to provide hope that the worst is over and a recovery is in the wings.

The number of unemployed hit 15.1 million in September, double what it was at the end of the economic expansion in December 2007.

Weekly initial jobless claims hit a ten-month low recently. Though still around 500,000, initial claims have remained below their late March peak of 674,000, another key metric for economists. What’s more, continuing claims have seen a sharp drop-off lately.

Job erosion also appears to be improving, although on a somewhat erratic basis. Non-farm payrolls did fall more than expected in September, but that followed month-to-month declines in several previous months.

Economists are now projecting an increase in payrolls by the end of the year or early 2010.

The BLS report on state jobless rates, however, was not without black marks. Three states—Nevada (13.3 percent), Rhode Island (13 percent) and Florida (11 percent)—all posted record highs in the 33-year history of the survey.

That kept them in the top ten, along with California (12.2 percent) and South Carolina (11.6 percent). North Dakota (4.2 percent) had the lowest rate of unemployment, followed by South Dakota (4.8 percent) and Nebraska (4.9 percent).

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