Although the U.S. unemployment rate rose slightly last month, some new jobs were added. So far in November, things are looking up in 25 states that had lower unemployment rates this week than last.
A new report released by WalletHub Thursday outlines statistics regarding where unemployment claims are decreasing, as well as where they are growing.
Data released Friday by the U.S. Bureau of Labor Statistics showed that while more than 260,000 new jobs were added in October, the unemployment rate increased by 0.2% to total 3.7%.
According to WalletHub, new unemployment claims decreased slightly week-over-week on Oct. 24 amid high inflation and looming concerns of a recession as the Federal Reserve Bank continues to raise interest rates in an effort to tame that inflation. Though the rates have been raised several times since March, inflation has remained high.
The Fed’s most recent rate increase – a 75 basis point rate hike – was announced Wednesday. These rate increases make it more difficult for people to borrow money and spend.
“Unemployment is expected to pick up again following this larger Fed rate hike,” said Jill Gonzalez, a WalletHub Analyst. “The chances of a sharp rise in unemployment in the U.S. over the coming year are high. The unemployment rate was expected to average 3.7% this year before rising to 4.4% and 4.8% in 2023 and 2024, respectively. That number has not been reached yet, so we should expect it fairly soon. Once unemployment does start to rise, the Fed should be able to pull back on its aggressive rate increases.”
Here are the states where unemployment has decreased the most in the last week:
1. Kentucky
2. New Hampshire
3. North Carolina
4. Arkansas
5. Tennessee
6. West Virginia
7. Delaware
8. Mississippi
9. Maryland
10. New Mexico
Overall, the 25 states where unemployment claims were lower than in the previous week were: Kentucky, Arkansas, North Carolina, South Carolina, New Hampshire, Florida, West Virginia, Tennessee, Mississippi, Hawaii, Alabama, Delaware, Kansas, Nevada, Missouri, Maryland, Colorado, Arizona, Louisiana, New Mexico, Oklahoma, Georgia, Wyoming, Texas and Ohio.
Gonzalez said that red states fared better than blue states this week when it came to unemployment decreases.
States where unemployment decreased the least in the last week were:
1. Oregon
2. Alaska
3. Rhode Island
4. Montana
5. Indiana
6. North Dakota
7. Virginia
8. South Dakota
9. Minnesota
10. Maine
South Carolina, Colorado, Kansas, Georgia and Indiana had unemployment claims last week that were worse than the same week last year, according to WalletHub.
“Every state had unemployment claims last week that were lower than in the same week pre-pandemic (2019) except for Connecticut, Wyoming, Alabama, Nevada, Michigan, New York, Illinois, Minnesota, Idaho, Alaska, Rhode Island, Nebraska, Oregon, Utah, Colorado, Florida and Indiana,” said the outlet.
Gonzalez said that if interest rate hikes do push the U.S. into a recession, it would have a significant negative impact on unemployment.
“Losing a job is never good, but when you combine it with such high inflation it can really become disastrous,” said Gonzalez. “Even Americans with jobs right now are struggling to afford essentials like food and gas. If those numbers to climb while more people become unemployed, we might see an economy in deep recession.”
As the nation continues to recover from COVID-19 pandemic-related fallout, there are more reported job openings than there are unemployed Americans. Gonzalez said this is a sign that “the next step might be looking to open up immigration to fill the surplus of jobs nationwide,” which could “help businesses meet their needs, but would also drive additional economic growth.”
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