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WASHINGTON (AP) — Unemployment rates rose in more than half of
U.S. states in June, evidence that slower hiring is affecting many
parts of the country.
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The Labor Department said Friday that unemployment rates in 28
states and Washington, D.C., increased last month. Rates declined
in eight states and were flat in 14. That’s a change from May, when
24 states reported falling unemployment rates.
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Twenty-six states reported a net gain in jobs in June, while 24
states lost jobs.
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The changing trend in state unemployment rates reflects a weaker
economy hampered by high gas prices and lower factory output.
Nationally, employers added only 18,000 net jobs in June, the
second straight month of feeble hiring. The U.S. unemployment rate
ticked up to 9.2 percent.
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The economy expanded only 1.9 percent in the January-March period,
and most economists expect similar growth in the April-June
quarter. The government releases its first estimate for
second-quarter growth on July 29.
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Nevada had the highest unemployment rate among the states in June,
at 12.4 percent. That’s up from 12.1 percent in May.
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It was followed by California (11.8 percent) and Rhode Island (10.8
percent).
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North Dakota reported the lowest unemployment rate, at 3.2 percent.
It was followed by Nebraska (4.1 percent) and South Dakota (4.8
percent).
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Some companies are cutting their work forces. Layoffs rose to their
highest level in nine months in May, according to a separate Labor
Department report last week.
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Tennessee, Missouri and Virginia reported the biggest job losses.
Tennessee said 16,900 jobs were cut last month, led by steep losses
in state and local government. Missouri suffered its biggest losses
in education and health services.
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Those states were also affected by harsh weather this spring, which
may have led to some job losses.
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Tennessee was swept by flooding, high winds, hail and tornadoes in
June, which washed out bridges, downed power lines and temporarily
closed a sewer treatment facility and a local airport.
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A May 22 tornado in Joplin killed 159 people, destroyed more than
7,000 homes and displaced 5,000 workers in a city of just 50,000.
The area reported 9,400 jobs were lost in June.
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The impasse in Washington over raising the federal government’s
borrowing limit could affect several states, including Tennessee
and Virginia. Those states could see a downgrade to their credit
rating if the U.S. defaults on its debt, according to Moody’s
Investors Services.
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The government reached its $14.3 trillion borrowing limit in May.
The Treasury Department has said it will default on its debt if the
limit is not raised by Aug. 2.
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Virginia is closely tied to the federal government because of its
large number of military bases, defense contractors and government
employees. A downgrade to a state’s rating would mean it would pay
higher interest rates to borrow money.
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Analysts are expecting another weak month of hiring in July, based
on recent data.
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The economy needs to generate about 125,000 jobs per month to keep
up with population growth and prevent the unemployment rate from
rising. It needs at least twice that many to rapidly reduce
unemployment.
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(This version CORRECTS Adds regional details, corrects that South
Dakota has third lowest state unemployment rate, not Montana. To be
distributed as part of AP’s general news and financial
services.)
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