Points of View

West Michigan’s Economic Rebound Outpaces the State and Nation

West Michigan’s Economic Rebound Outpaces the State and Nation

Alex Andrews

The unemployment rate across the state skyrocketed to achieve a historic high of 23.6 percent in April — the highest jobless rate seen for Michigan since at least 1976 — and fell to 5.1 percent as recently as October, slightly below the national rate of 6.6 percent. The 3.1 percentage point recovery to the state’s unemployment rate that occurred from September to October outpaced recovery nationwide (1.1 percent) and reflects an over-the-month employment gain of 184,000 workers. This was the largest over-the-month growth to employment observed in Michigan since June, when the labor market gained 467,000 employees. However, employment counts across the state remain 153,000 below those recorded in February, reflecting a negative growth rate of 3.2 percent since the onset of the pandemic. The number of unemployed residents in Michigan fell by 150,000 over-the-month, which was the largest monthly decrease observed since July when unemployment fell by 283,000. Although the size of the unemployed population in Michigan is currently 137 percent larger than February, it is a far cry from the record-high of 1.1 million unemployed recorded in April.

 

Economic recovery continues in West Michigan

April’s unemployment rate of 23.0 percent was also a historic high for West Michigan, reflecting a spike of 20.1 percentage points from the rate of 2.9 percent recorded in March, though the region’s jobless rate has since fallen to 4.0 percent in October — outpacing the rate of recovery observed both statewide and nationally. The drop of 2.6 percentage points to the region’s jobless rate observed over-the-month resulted from an employment gain of 7,282 (0.9 percent), while the number unemployed dropped by 23,513 (-41.9%) from September to October to achieve a total of 32,600 jobseekers. Although the size of the region’s unemployed population remains 135 percent larger than February, the 41.9 percent rate of recovery observed over-the-month was the largest recorded since the onset of the pandemic.

 LF & UR.pngSource: DTMB, Bureau of Labor Market Information and Strategic Initiatives, Local Area Unemployment Statistics

 

Nonfarm payroll jobs in West Michigan grew by 3,200 from September to October, signaling the sixth month of positive job growth for the region since the pandemic-imposed state lockdown in March. However, October’s job growth rate of 0.5 percent was nearly half the rate observed from August to September. Job growth over-the-month was concentrated among Service-providing industries, which recovered 3,300 jobs (+0.8%), while 100 jobs were displaced among Goods-producing industries (-0.1%). The largest over-the-month job gains were concentrated among Professional and Business Services (+3.1%; +2,300 jobs), Government (+1.3%; +700 jobs), Education and Health Services (+1.0%; +1,000 jobs), Financial Activities (+0.7%; +200 jobs), and Trade, Transportation, and Utilities (+0.2%; +200 jobs). Conversely, just three sectors in West Michigan experienced job loss in October, led by Leisure and Hospitality (-2.2%; -1,000 jobs), Other Services (-0.4%; -100 jobs), and Mining, Logging, and Construction (-0.3%; -300 jobs).

 

Job Growth, indexed to March

Source: DTMB, Bureau of Labor Market Information and Strategic Initiatives, Current Employment Statistics

 

Although nearly all West Michigan industries have shown evidence of recovery since the onset of the pandemic, total regional job counts remain 40,500 (-6.5%) below estimates recorded in the first half of March, with significant variations across industries and sectors. Roughly 11,300 jobs have been displaced among Goods-producing industries since the onset of the pandemic, a growth rate of -7.1 percent, while 29,200 (-7.3%) jobs have been displaced among Service-providing industries. Pandemic-related job losses were especially pronounced among Leisure and Hospitality — which has lost 17.6 percent of its workforce since March (-9,700 jobs) — and Manufacturing, which currently has 14,300 fewer jobs (-10.9%). As of October, Mining, Logging, and Construction remained the only industry in West Michigan to employ more workers following the lockdown than before it, gaining 3,000 jobs (+10.8%) since March. Although it would appear that jobs are beginning to shed in this highly seasonal sector as we head into colder weather, with an average monthly decrease of 300 jobs observed since July.

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