The numbers, on the surface, look encouraging: Michigan’s unemployment rate has dropped again. New claims for unemployment benefits fell this month. Manufacturing output is rising.
Ford's Rouge plant, by Charles Sheeler
But there’s another side to the jobs numbers: people simply giving up on finding work. (Take our Changing Gears survey.)
The conflicting numbers make it hard to get a clear picture of the jobs market.
Here’s what we know:
- Michigan’s unemployment rate fell to 9.3 percent in December, but the size of the workforce continues to drop, according to our partner station Michigan Radio. It says Michigan’s unemployment rate plus the “under-employment” rate (people working part time jobs because that’s all they can find, or in fields not related to their expertise) is 18.8 percent. Continue reading →
Three stories making news across the Midwest today:
1. Detroit’s finances a long-term problem. In the past 45 years, the city of Detroit has recorded 19 budget surpluses and 26 budget deficits, according to the Detroit Free Press. Experts tell the newspaper the city’s debt is now so high that the city could default on unpaid bonds soon, a prelude to bankruptcy. State officials will begin a formal review of Detroit’s finances in January, which could lead to the appointment of an emergency manager. Gov. Rick Snyder said the city faces both a short-term cash-flow shortage and a longer-term structural deficit. “We can’t continue this process because Detroit has been in a financial crisis of some fashion for decades,” he tells the newspaper. “We need a long-term solution.”
2. 2011′s dubious housing distinction. The year 2011 will likely be the worst in history for new home sales. The Commerce Department said it expects the adjusted annual number to reach 315,000 by the close of this month, fewer than the 323,000 sold last year, the worst year on record dating to 1963. That’s less than half the 700,000 new homes economists tell the Associated Press are necessary to sustain a healthy market. The projection comes even as new-home sales rose 1.6 percent in November. December would need to mark its best monthly sales total in four years to avert the dubious finish.
3. Unemployment up in Chicago area. Chicago’s unemployment rate rose in November to 9.8 percent, according to the Chicago Sun-Times. The rate ticked upward one-tenth of a percentage point from 9.7 percent in October, and was up 0.9 percent year over year. The unemployment rate dropped in nine of Illinois’ 12 metro areas in November compared to 2010. Chicago’s rate remains slightly lower than the state’s overall 10.0 percent unemployment rate, which has remained nearly flat for three consecutive months. The state’s lowest unemployment rate was found in the Bloomington/Normal area, at 6.8 percent, according to the newspaper.
The national unemployment rate fell 0.4 percent in November to 8.6 percent. Michigan led the downward charge.
No state in the nation experienced a bigger drop. Michigan’s unemployment rate fell 0.8 percent in the month to 9.8 percent. It’s the first time in three years the state’s unemployment rate was less than 10 percent. Overall, 43 states reported unemployment declines in November.
The Midwest’s monthly unemployment rate edged downward 0.3 percent in November to 8.2 percent, the second-lowest of the nation’s four regions. Every state in the region experienced a decline in unemployment rate except Indiana, which saw its rate hold steady at 9.0 percent.
The West North Central sub-region, defined by the U.S. Labor Department as North Dakota, South Dakota, Minnesota, Nebraska, Iowa, Kansas and Missouri, held the nation’s lowest sub-regional unemployment rate, at 6.3 percent.
Here’s a state-by-state look at the November unemployment numbers for each Midwest state:
State Oct. 2011 Nov. 2011 Change
Michigan 10.6 9.8 -0.8 percent
Minnesota 6.5 5.9 -0.6 percent
Ohio 9.0 8.5 -0.5 percent
Wisconsin 7.7 7.3 -0.4 percent
Iowa 6.0 5.7 -0.3 percent
Pennsylvania 8.1 7.9 -0.2 percent
Illinois 10.1 10.0 -0.1 percent
Indiana 9.0 9.0 0 percent
Yesterday, we told you that Michigan’s unemployment rate dropped below 10 percent in November for the first time in three years. Now comes word that Illinois’ jobless rate also dropped last month, and the state added jobs in November, although not as many as it has been adding.
Illinois’ unemployment rate was 10 percent, down from 10.1 percent in October. The state, which has been adding an average of 6,000 jobs a month this year, added only 600 jobs in November.
Although Illinois officials said the state has added jobs in eight of the past 11 months, the state’s unemployment rate is actually up from 9.4 percent in November a year ago.
The national unemployment rate is 8.6 percent.
On Wednesday, Michigan officials said their state’s jobless rate was 9.8 percent last month, according to the state Department of Technology, Management and Budget. A year ago, the Michigan jobless rate was 11.4 percent.
Michigan has at times had the highest unemployment rate in the nation, peaking above 14 percent in 2009. But today, state officials said the November rate dropped below 10 percent for the first time in three years, although the decline is primarily due to fewer people seeking jobs.
The jobless rate was 9.8 percent last month, according to the state Department of Technology, Management and Budget. A year ago, the jobless rate was 11.4 percent.
Michigan’s unemployment rate compares with a national rate of 8.6 percent, but state officials say the unemployment rate in Michigan has dropped by a full percentage point since this past August.
It was the lowest rate for Michigan since October, 2008, when the rate stood at 9.4 percent. The following month, the state unemployment rate rose above 10 percent, and has been in double digits ever since. Continue reading →
Three stories making news across the Midwest today:
1. Mining company lays off 600 workers. A mining company in Michigan’s Upper Peninsula will temporarily shut down part of its operations and lay off approximately 600 employees. Cliffs Natural Resources, which operates the Empire Mine in Marquette County, said production is expected to drop from 4.6 million tons in 2011 to 2.7 million tons in 2012, according to the Marquette Mining Journal. The drop comes because steel producer ArcelorMittal will take a blast furnace down for maintenance in the second quarter. A company spokesperson said the layoffs will last “several months” until the furnace goes online again.
2. Historic Cleveland property has new owner. One of Cleveland’s historic downtown landmarks was purchased today by a Canadian hotel and resort company during a foreclosure auction. Skyline International Development Inc. was the sole bidder for the Arcade, and purchased it for $7.7 million – the minimum bid, according to The Plain Dealer. The current site was renovated a decade ago for $60 million, but went into foreclosure in April 2009 when its Chicago-based owner defaulted on a $33.3 million mortgage. An attorney for the new owners said this is Skyline’s first U.S. real estate holding, but did not comment on the firm’s plans for the Arcade. With the property selling for the minimum, its creditors, including Bank of America, the city of Cleveland and Cuyahoga County, will not recoup any of their investments.
3. Chinese students Milwaukee bound. Hundreds of Chinese students could attend the University of Wisconsin-Milwaukee in coming years thanks to a recruiting agreement the school’s chancellor signed today in Beijing. An agreement with a Chinese education network will boost the university’s international profile and help lure Chinese companies to Milwaukee, according to the Milwaukee Journal Sentinel. It would also boost the school’s out-of-state tuition coffers. China is the city’s third-largest trading partner, according to the newspaper. The agreement runs for five years. “You could think of myriad ways these students could connect to help Milwaukee employers in China,” said Tim Sheehy, president of the Metropolitan Milwaukee Association of Commerce.
Three stories making news across the Midwest today:
1. Michigan’s unemployment rate drops. Michigan’s unemployment rate fell a half-point to 10.6 percent in October from 11.1 percent in September, according to numbers released Wednesday from the Michigan Department of Technology, Management and Budget. It was the second straight month the state’s rate declined. The decline came “due primarily to a reduction in the number of unemployed individuals actively seeking employment,” Rick Waclawek, director of the Bureau of Labor Market Information & Strategic Initiatives, said in a statement. Nationally, unemployment claims fell to a seven-month low Wednesday, according to our partner station WBEZ. The four-week average fell to 396,750, the first time the average has been below 400,000 in seven months.
2. Indy Plant Eschews Coal For Natural Gas. A plant that generates steam for heating some of Indianapolis’ biggest downtown institutions will convert its coal-burning boilers to natural gas. Citizens Energy Group CEO Carey Lykins tells the Indianapolis Star the project will “mean cleaner air for downtown Indianapolis and provide significant savings for our customers compared to continued use of coal.” The conversion could be completed as early as 2014 and save the company $5 million in annual operating costs. The Perry K plant heats many downtown businesses and institutions, including Lucas Oil Stadium and the Indiana University-Purdue University Indianapolis campus.
3. Milwaukee Streetcar Support Swells. Supporters of a Milwaukee Streetcar project outnumbered its detractors by a 2-to-1 margin at a public hearing held Wednesday night on the planned streetcar line’s environmental impact. Supporters said the streetcar project will improve city transportation and stimulate economic development along the line. Opponents believe the cost is one the city cannot afford. City alderman have already voted to approve the project and move ahead with engineering, according to the Milwaukee Journal Sentinel, but have withheld final approval “until more details are fleshed out.”
A quarter-century ago, Bruce Springsteen wrote “My Hometown,” a melancholy song that captured the economic tensions caused by closures of a factory and textile mill in Freehold, New Jersey.
Ford's Rouge plant, by Charles Sheeler
It was written in 1985 at the outset of America’s industrial decline. In 1979, nearly 20 million people were employed in the manufacturing industry. Today, the manufacturing workforce employs 11.7 million, according to Forbes, a decline of 39 percent from its peak.
Springsteen wrote:
They’re closing down the textile mill across the railroad tracks
Foreman says these jobs are going boys and they ain’t coming back
And that’s OK, argues Forbes.
“The reality of the situation is this: We should be glad those jobs are gone,” writes David M. Ewalt on the magazine’s website. “We don’t need them.”
Continue reading →
Three stories making news across the Midwest today:
1. Marathon Petroleum buys Detroit neighborhood. An oil refinery in Detroit wants to buy all the houses in the entire 48217 zip code as part of an expansion plan. Marathon is offering $50,000 per home to approximately 400 homeowners. The Atlantic writes the move is an unusual one, because the expansion actually won’t be located on the land. It’s more or less a goodwill transaction, in which “the company is essentially saying what few industries or companies will admit: I’m going to be a bad neighbor. I will make you sick.” Zip code 48217 represents one of the most heavily industrialized areas of Detroit.
2. Unemployment rate ever-so-slightly declines. The nation’s unemployment rate ticked down to 9 percent in October, the first time it has fallen since July, the U.S. Labor Department announced today. The nation’s economy added 80,000 jobs and the rate fell one-tenth of a percent from 9.1 percent. Our partner station WBEZ reports economists view the improvement as an encouraging sign, although a survey conducted by financial data provider FactSet showed they had expected a larger gain. The Labor Department also revised data from August and September, and said the economy added 102,000 more jobs in those two months than initially reported.
3. Small growth predicted for Indiana economy. Indiana’s economy is pointed in the right direction, but will not grow at a pace that fixes devastation wrought by the recession. That’s the consensus of a panel of Indiana University economists. They predicted Thursday that in 2012 the state will see a modest unemployment drop, a “slight” uptick in business output and a small gain in payroll, according to the Indianapolis Star. The five-person panel agreed that, like other states, Indiana will largely be at the mercy of national and global conditions. “Our economy is in trouble really, because of a generation of fiscal mismanagement,” associate professor Robert Neal, a former economist at the Federal Reserve Bank, told the newspaper.
Some contradictory news emerged on the Michigan economy today.
The state’s economy is recovering from the Great Recession at the second-fastest pace of any state in the country, according to a Bloomberg index that measures the pace of state growth. Only North Dakota outpaced Michigan, which was led by the resurgence of Detroit’s automakers and local manufacturing.
Seventy percent of Michigan employers said they expected the state’s economic outlook would improve over the next 18 months, according to Bloomberg Businessweek, which first reported the results. But the financial magazine also said the improvement reflects the severity of Michigan’s decline – it ranked last in the index through 2010.
Michigan still has formidable challenges ahead. Elsewhere, a report released today by outplacement firm Challenger, Gray & Christmas showed that it ranks as the fourth-highest state or district in number of layoffs to date in 2011. The report said that 29,312 Michigan employees have been laid off so far this year.
Continue reading →
