Unemployment rises in almost half of metro areas

AP News
Posted: Dec 02, 2009 5:14 PM

Unemployment worsened or stayed the same in most metro areas in October, the Labor Department said Wednesday, as jobs remained scarce nationwide.

The report comes a day before the Obama administration is to hold a "jobs summit" at the White House that will gather economists, academics and corporate executives to consider how the government can spur job creation.

The jobless rate rose in 162 of the 372 metro areas tracked by the Labor Department. The rate was unchanged in 42 areas. It dropped in 168 areas.

In September, unemployment had improved in 223 areas and worsened in only 123. The deteriorating trend mirrors the U.S. unemployment rate, which jumped to 10.2 percent in October from 9.8 percent in September.

The metro unemployment data isn't seasonally adjusted and is therefore volatile from month-to-month. All 372 areas reported higher unemployment rates in October compared with the previous year.

The unemployment rate varied widely from city to city based largely on the dominant industry in each area, said Ernest Goss, professor of regional economics at Creighton University in Omaha, Neb.

Manufacturing states like Michigan and Indiana were hit hard, while Sun Belt cities in Arizona and California remain distressed from the housing bust. At the same time, Midwestern cities like Lawrence, Kan., and Ames, Iowa, fared well partly because their economies were never as pumped up as those on the coasts. Smaller cities remain far less damaged from the subprime mortgage collapse, Goss said.

"When you don't have a huge upside in housing prices, when there is a bubble to burst your bubble is smaller," he said.

The Labor Department is scheduled to release the national unemployment report for November on Friday. Wall Street economists expect it will show the jobless rate was unchanged at 10.2 percent while employers shed 130,000 jobs, according to Thomson Reuters. There were 190,000 job cuts in October.

Fifteen areas recorded jobless rates of 15 percent or worse in October, the department said, with nine of those in California and three in Michigan. That's up from 13 areas with rates above 15 percent the previous month.

Fresno, Calif., for example, saw its jobless rate soar to 15.8 percent from 14 percent in September. And the rate in Hanford-Corcoran, Calif., jumped to 15.5 percent from 13.9 percent.

The areas with the biggest increases in October from the previous month were: Waterloo-Cedar Falls, Iowa, which soared to 8 percent from 5.6 percent; Ocean City, N.J., to 10.6 percent from 8.5 percent; and Sandusky, Ohio, to 10.9 percent from 9.5 percent.

The largest improvements were in: Lawrence, Kan., where the rate fell to 4.7 percent from 5.4 percent; Ames, Iowa, to 4 percent from 4.5 percent; and Boston-Cambridge-Quincy, Mass., to 7.9 percent from 8.8 percent.

El Centro, Calif., and Yuma, Ariz., posted the nation's highest jobless rates of 30 and 23.5 percent, respectively. The two adjacent counties are heavily agricultural and have many seasonal farm workers.

Bismarck, N.D., recorded the nation's lowest rate, at 2.8 percent, followed by Fargo and Grand Forks, N.D., both at 3.5 percent.


AP Business Writer Christopher Leonard in St. Louis contributed to this report.