Editor's Note: This report is based on survey data from September 2023 that was published in October 2023. This is the most recent data available. (Source: Bureau of Labor Statistics)
The US unemployment rate held steady at 3.8% despite the fact that nearly one-third of states recorded month-over-month increases in their statewide unemployment rates.
In total, 16 states saw their unemployment rates rise last month while the remaining 34 plus Washington DC saw their unemployment rates remain essentially unchanged.
At the same time, 6 states reported month-over month increases in their payroll figures while the remainder saw no significant movement in either direction.
Below is the breakdown of the Bureau of Labor Statistics’ (BLS) market employment summary for October 2023.
Nevada had the highest unemployment rate last month, as it has for much of the last year. The good news is that Nevada’s unemployment rate is again trending in the right direction, inching down from 5.4% to 5.3% over the month.
Washington DC had the next highest unemployment rate at 5%, where it has held steady for several months in a row.
California, at 4.7% unemployment, was the only other state with an unemployment rate that was higher than the US average in a statistically significant way, although 12 states in total have unemployment rates that exceed 3.8%.
Illinois had the largest month-over-month increase in unemployment rate at plus three-tenths of a point, climbing from 4.1% to 4.4%. In total, 15 other states also saw increases in their unemployment rates over the month ranging from 0.1% to 0.2%.
10 states in total saw significant increases in their unemployment rates over the last 12 months, led by Washington DC at plus 0.9%, California at plus 0.7%, and Alaska, Colorado, and Indiana - each at plus 0.4%.
Maryland again recorded the lowest unemployment rate, down from 1.7% to 1.6% over the month, followed by the Dakotas and Vermont, all at 1.9% unemployment.
While no state saw a statistically significant reduction in their unemployment rate over the month prior, nearly half of all states (24) have unemployment rates that are currently lower than they were 12 months ago.
Maryland saw the largest unemployment rate decrease over the year at -1.6%, while New Jersey saw a -1.2% reduction, and Massachusetts, Oregon, and Vermont each came in at -1.1%.
No states saw statistically significant job losses last month.
A total of 6 states recorded an increase in payroll figures over the month, led by Texas with about 61 thousand new jobs, followed by Georgia with about 17 thousand new jobs and Oregon with about 8 thousand new jobs.
In terms of percentage growth over the month, South Dakota tops the list at plus 0.9%, then Delaware at plus 0.7% and Mississippi at plus 0.5%.
36 states have seen a net increase in their payroll figures over the last 12 months, with Texas, California, and Florida adding the largest numbers of total jobs (about 435, 300, and 240 thousand, respectively), while Nevada, Texas, and Idaho claimed the largest percentage job growth at plus 3.4%, 3.2%, and 3.0%.
When Federal Reserve officials met last month, although the majority seemed to favor implementing one more rate hike before bringing their rate-hiking campaign to an extended (and hopefully indefinite) pause, there was a faction who expressed their belief that no more hikes were necessary for the foreseeable future given current conditions.
In light of the unexpectedly strong jobs reports that have come out since, however, the majority in favor of another hike is more likely to grow than shrink when they reconvene next month.
Even more tellingly, after the September's Consumer Price Index data showed slightly higher inflation than anticipated, futures contracts linked to Fed policy jumped from reflecting about a 28% probability that the Fed would increase baseline rates again in 2023 to about a 40% probability, which is clearly significant movement.
At the moment, the odds may still favor pausing rate hikes for the remainder of the year, but the momentum certainly seems to be building on the side that’s pushing for another rate hike sooner than later. We will keep an eye out for signals one way or the other as the data accumulates.
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