Editor's Note: This report is based on survey data from April 2023 that was published in May 2023. This is the most recent data available. (Source: Bureau of Labor Statistics)
With the unemployment rate again falling to 3.4% nationwide for the second time this year, 2023 currently maintains the lowest average unemployment for any year on record since the 1960s.
The month-to-month reduction was 0.1% across the US as a whole, which was spread between 14 states which each registered a decrease in their unemployment rates while 36 states and Washington DC essentially remained stable.
Stability was largely the story on the payroll side, as well, with 44 states plus DC showing little to no increase in their job numbers, whereas 5 states reported an increase in jobs and 1 reported a loss.
Over the past year, the unemployment rate is down 0.2% from where it was 12 months ago across the country as a whole, but only 16 states have seen their internal unemployment rate decrease during that time, while 10 states actually have registered year-over-year increases.
80% of states have seen a net gain in their total number of jobs over the year while the remainder and Washington DC saw no significant change.
Below is the breakdown of the Bureau of Labor Statistics’ (BLS) market employment summary for May 2023.
Nevada remains the only state to exceed 5% unemployment for the third straight month at 5.4%, though it is down a tenth of a point from the month before and trending in the right direction, whereas Washington DC saw its unemployment rate climb by two-tenths of a point from 4.8% to 5.0% even over the month.
And while DC was the only “state” that registered an increase in unemployment last month, they are now joined by New York and California which each reported an unemployment rate increase of a tenth of a point as of the latest BLS report.
The largest year-over-year increases occurred in Kansas, Minnesota, and Virginia which saw their average statewide unemployment rates climb half a point each over the last 12 months.
South Dakota held steady at 1.9% unemployment and claimed the lowest unemployment rate in the nation for the second consecutive month, followed by Nebraska at 2.0% and New Hampshire and North Dakota at 2.1%.
Over the past year, 10 states in total saw their unemployment rates fall, led by New Mexico at minus 0.8% followed by Maryland at minus 0.6%.
Rhode Island was the only state that saw their total number of jobs decrease over the month, which saw a reduction of 3,800 jobs, representing 0.8% of their current employed population.
5 states in total increased the size of their in-state payrolls, led by Indiana which added nearly 15 thousand new jobs, representing about 0.5% of their total number of jobs.
Arizona, California, and New Jersey each saw their employment levels go up by 0.4% - about 13, 67, and 18 thousand new jobs, respectively - while Ohio clocked a 0.3% increase amounting to about 18 thousand new jobs, as well.
The data included in this release was collected during the month of April, during which time there were no bank failures and no interest rate hikes, which is not something that could be said about either the month before or after.
In hindsight, April looks like a serene reprieve, and the impressive jobs numbers rolled in accordingly despite financial market disruptions and a quarter point interest rate hike in March on top of the ~5% in collective rate hikes that have been stacking up in what’s been called the most aggressive interest-rate-adjusting campaign from the Federal Reserve in 40 years.
Will this level of performance on the job creation and employment fronts continue given the fall of FIrst Republic Bank and another quarter point hike from the Fed in just the first few days of May?
It appears that at least half of the Federal Reserve board seems to think so, considering it was only a couple weeks ago that they were signaling a likely pause in rate hikes for the time being, and now the AP reports there may be a split in the board about more rate increases are still needed in the short-term when they meet again in mid-June.
The jobs data from May will be available by the time those decision-makers reconvene, of course, so we’ll likely have a clearer picture at that point as to whether or not the last rate hike and/or financial shockwave will have any more noticeable of an impact on the US employment situation than the last ones did, which in turn will inform the interest rate debate.
Until then, we’ll have to wait and see.
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