Investing

This Is the State With the Highest Unemployment

Douglas A. McIntyre

Published: May 29, 2021 9:15 am

Last Updated: June 1, 2021 9:01 am

The first few months after the COVID-19 pandemic, American unemployment rates reached the highest levels since the Great Depression. That has improved substantially and the national jobless rate currently hovers around 6%. However, that remains much higher than in early 2020 when unemployment was at a five-decade low, at 3.5%.

The Bureau of Labor Statistics releases data on state unemployment levels each month. The most recent, STATE EMPLOYMENT AND UNEMPLOYMENT — APRIL 2021, showed the jobless level was lower in 12 states and the District of Columbia and stable in 38 states when compared to March. However, since April 2020 was the worst jobs month during the pandemic, 48 states and the District had unemployment rate decreases from a year earlier and two states were about the same. The unemployment rate nationwide for April was 6.1%

The unemployment rate across all the states and the District of Columbia always varies widely. The factors for the changes are usually easy to detect. Hawaii had the highest jobless rate for the month at 8.5%. This is similar to rates posted nationally during The Great Recession, an indication of just how badly the Hawaii jobs market has been damaged.

By contrast, April in Nebraska, New Hampshire, South Dakota and Utah had the lowest state rates at 2.8% each.

Hawaii has faced two problems on the employment front. The first is that the tourism business has been savaged by the pandemic. By most estimates, tourism is the largest contributor to state GDP and the industry that employs the most people. Only government and healthcare contribute at nearly as high a level.  The federal government effectively blocked air travel for months.

Second, the state has done an extraordinary job of protecting its population. Hawaii has had a surprisingly low number of deaths, even for its population size. However, the other side of this is that it has exacerbated the tourism trouble as travelers have been almost completely locked out of the state based on its measures to keep COVID-19 at bay. Federal restrictions have been strengthened by state restrictions.

Because travel may well remain low for the next several months, Hawaii’s job problem won’t go away.

Click here to see which city has the highest unemployment rate in America.