Points of View

May Labor Market Trends in West Michigan

May Labor Market Trends in West Michigan

Alex Andrews

Statewide Unemployment in May

Michigan’s unemployment rate reached historic levels at the onset of the pandemic, skyrocketing by 19.6 percentage points to achieve a rate of 23.6 percent in April — the highest jobless rate seen for the state since at least 1976 (as far back as comparable records extend) — and stood at 20.7 percent as recently as May. The modest recovery to the state’s unemployment rate from April to May reflects an increase of 256,000 in the number of employed residents across Michigan, which remains over 1 million below employment counts recorded in February, while the number unemployed fell by 97,000 over-the-month. The state’s labor force recovered 159,000 participants in May as industries continued to reopen and furloughed employees began returning to work, although the size of the state’s labor force is currently 200,000 participants shy of the volume observed before the pandemic in February.   

The rate of economic recovery observed throughout Michigan over-the-month significantly lagged the 1.4 percentage point drop to unemployment seen nationwide, with the national unemployment rate at 13.3 percent in May — nearly 7.4 percentage points below the statewide jobless rate. Michigan’s seasonally adjusted job count rose by 178,000 in May to reach just over 3.5 million, a growth rate of 5.2 percent, with the greatest over-the-month job gains concentrated in those industries who were first allowed to reopen following the statewide lockdown in March. May job gains were most prevalent among the sectors of Construction (+52%; +51,000 jobs) and Trade, Transportation, and Utilities (+7.8%; +50,000 jobs), while Government (-2.2%; -13,000 jobs) and Natural Resources and Mining (-28.6%; -2,000 jobs) continued to lose jobs over-the-month. With only 5,000 jobs in May, Michigan’s mining and logging sector now employs the lowest volume of workers recorded for the state since 1990.

 

Labor Force Trends in West Michigan

Adhering to the trend observed across the nation, the 23.0 percent rate of unemployment seen for West Michigan in April was a historic high — reflecting a spike of 20.1 percentage points from the rate of 2.9 percent recorded in March. The region’s jobless rate recovered slightly in May to hit 18.2 percent, which still significantly exceeds the peak of 12.5 percent recorded during the apex of the Great Recession in 2009. The modest economic recovery observed in West Michigan over-the-month resulted from an employment gain of 82,308 (+13.6%), while the number unemployed dropped by 28,189 (-15.6%) from April to May to achieve a total of 152,575. The region’s labor force gained 54,119 participants in May, mitigating the attrition observed in April to achieve a total of 840,202. Although the size of West Michigan’s labor force currently stands over 9,000 participants higher than in 2019, the volume in February was nearly 3,000 larger than the latest estimates obtained in May.

LF & UR

West Michigan’s job count rose by 41,700 (+8.7%) from April to May, signaling the first month of positive job growth for the region since the pandemic-imposed state lockdown in March. Job recovery over-the-month was most pronounced among Service-providing industries, which gained 26,200 jobs (+7.2%), while Goods-producing industries gained 15,500 jobs (+13.5%). The largest over-the-month job gains were concentrated among Professional and Business Services (25.7%; +13,200 jobs), Mining, Logging, and Construction (+58.5%; +10,700 jobs), and Trade, Transportation, and Utilities (+10.3%; +9,300 jobs). Conversely, job losses persisted through May for West Michigan’s Information (-1.6%; -100 jobs) and Government (-5.2%; -2,900 jobs) sectors.    

Occupational Job Loss, May-1

Although nearly all West Michigan industries have shown evidence of recovery since April, total regional job counts are still 106,100 (-16.9%) short in comparison to the counts recorded before the pandemic, with significant variations across industries and sectors. Goods-producing industries have lost nearly 29,000 jobs since March, a growth rate of -18.1 percent, while Service-providing industries have lost over 77,000 workers (-16.6%). Pandemic-related job losses were especially pronounced among Accommodation and Food Services — which has lost nearly 48 percent of its workforce since March (-23,500 jobs) — and Leisure and Hospitality, which lost 26,000 jobs (-47.1%) since the onset of the pandemic. As of May, Mining, Logging, and Construction remained the only industry in West Michigan to employ more workers following the lockdown than before it, gaining 1,100 jobs (+3.9%) since March.

 

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