Michigan jobless rate drops, but not because more companies are hiring

Apr 16, 2015

Michigan’s unemployment rate has dropped to 5.6 percent. That’s a reduction of three-tenths of a percentage point, which is a bigger-than-usual adjustment.   

But that decline in the monthly rate is due to a reduction in the workforce, as it’s measured by the US Bureau of Labor Statistics and the state Bureau of Labor Market Information and Strategic Initiatives. Actual month-to-month new hiring was flat, but there were fewer people competing for those jobs.

That didn’t stop Governor Rick Snyder (R) from trumpeting the new jobs numbers in a prepared statement:

“We have momentum as Michigan’s unemployment rate continues to drop. In December 2010, Michigan’s unemployment was nearly 2 percent above the national average. Today, we are one-tenth of a percent behind.”

It’s been more than 15 years -- September of 2000 – since Michigan’s jobless rate has been the same or lower than the national average.

And the longer-term trend is an expansion of more hiring and new jobs.

Michigan’s jobless rate is down two percentage points from where it was at this point last year. Over the past 12 months, business services and temp workers, manufacturing, and construction have led new hiring, according to Bruce Weaver of the Michigan Bureau of Labor Statistics and Strategic Initiatives. He says public employment in federal, state, and local governments is the only sector that’s stagnant.

“Beyond that, all of the private sector, you see job growth over the last year or at least stable job levels between 2014 and ’15,” he said.  

The combined rate of unemployment and under-employment has also dropped. That rate is 13.1 percent. That number includes part-time workers who would like to be full-time, and people who’ve quit looking for jobs.