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Regional Unemployment Notes
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It is no secret that unemployment is high and getting higher. The national rate is now 8.5%, up from 8.1% in February. However, the pain has not been spread equally. There are now eight states with double digit unemployment, a level that nationwide was only seen at the very depths of the early 1980’s recession, and which for many people represents a fairly workable definition of a depression (there is no official agreed upon definition).
On the other hand, there are also eight states with unemployment that is below 6.0%, a level that is pretty close to what many economists would consider full employment (some disagreement here on the level of "full employment" but in the ballpark).
The problem is that almost nobody lives in the low employment states, and lots of people live in the high employment states. The eight "full employment" states together account for just 5.71% of the total population of the country. The eight "depression" states account for 24.25% of the population.
California alone has more than twice the population of the eight full employment states combined. The largest state among the "full employment" group only ranks 25th in population, and the list includes three of the four smallest population states. In contrast, three of the largest states in the union are "depression" states.
The trend toward higher unemployment is continuing. The list of "depression" states will grow. Four additional states (FL, KY, OH, TN) are knocking on the door of depression status with unemployment rates of 9.6% or higher, as is the District of Columbia. Together they account for an additional 13.31% of the population. Thus, there is a good chance that by next month more than one third of the country will be living is a depressed state. By the end of the year, I would expect that to be more than half the country.
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| Market Summary | Feb 10, 2012 07:10 am ET |
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