The States That Recovered Most (and Least) from the Recession

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1. Michigan
> Unemployment decline from peak: 5.1 percentage points
> Peak unemployment:  14.2%
> Current unemployment: 9.1% (6th highest)
> GDP growth 2011: 2.3% (6th highest)

In November 2007, when the nation was on the brink of the worst economic recession in years, Michigan had by many measures the worst economy in the U.S. The state’s unemployment rate was more than a full percentage point higher than any other state. And once the recession hit, Michigan’s already struggling economy was not spared. Unemployment nearly doubled, peaking at 14.2% by August 2009, the highest rate any state reached during the recession. In 2008, the state’s economy contracted by 6%, more than any other state in the country. In 2009, Michigan’s GDP again shrank more than any other state, this time by nearly 9%. While the state has since shown some substantial signs of recovery, it still has a long way to go. Michigan has been in the top 10 for GDP growth in each of the past two years. And while its unemployment rate remains high, it is now better than five other states after declining 5.1 percentage points from its peak. According to BLS Chief Economist Martin Kohli, Michigan’s economy has been boosted by the resurgent American automobile industry.

2. Ohio
> Unemployment decline from recession peak: 3.7 percentage points
> Peak unemployment: 10.6%
> Current unemployment: 6.9% (tied-21st lowest)
> GDP growth 2011: 1.1% (23rd lowest)

Ohio’s unemployment rate nearly doubled during the recession, from 5.7% in November 2007 to 10.6% in July 2009. In less than two years, nearly 300,000 residents lost their jobs. As of October there were more than 100,000 fewer manufacturing jobs and almost 80,000 fewer jobs in the trade, transportation and utilities sector than five years before. But recently the state’s job market has begun to rebound as the unemployment rate has decreased by 3.7 percentage points from its peak of 10.6% to 6.9% as of October. The 2012 Obama Campaign touted the president’s decision to save the auto industry, saying it “meant one thing for Ohio: jobs.” The campaign noted that “1 in 8 Ohioans have been supported by the auto industry.” The recovery, however, comes with a caveat: between November 2007 and October 2012 Ohio’s labor force shrank by 3% — more than almost any state.

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3. South Carolina
> Unemployment decline from recession peak: 3.4 percentage points
> Peak unemployment: 12.0%
> Current unemployment: 8.6% (tied-12th highest)
> GDP growth 2011: 1.2% (24th highest)

Through October, South Carolina’s unemployment rate fell 3.4 percentage points from its all-time high of 12% during the last two months of 2009. Since then, the state began a slow recovery. By October 2012, in just under three years time, another 75,000 workers in the state had found employment. Manufacturing jobs, which steadily declined through the 2000s, have also slowly recovered in the state in recent years. Mass layoffs, defined by the BLS as occurring when at least 50 new unemployment insurance claims are filed against an employer in a five-week period, declined from a high of 493 in 2009 to 225 in 2011. In the first 10 months of 2012 there were just 147 such events.

4. Utah
> Unemployment decline from recession peak: 3.1 percentage points
> Peak unemployment: 8.3%
> Current unemployment: 5.2% (tied-5th lowest)
> GDP growth 2011: 2.0% (8th highest)

In November 2007, Utah had the nation’s third-lowest unemployment rate of 2.8%. Reaching 8.3% in January 2010, the state’s unemployment rate fell to 5.2% in October, again one of the lowest in the nation. However, as of October, the state still had not recovered many of the jobs it had lost as the total number of employed workers that month was still 3.5% less than it was in November 2007. Over the 12 months through October, Utah’s job market has improved. During that time, the state added jobs, especially in the financial, information, and professional and business services sectors, where the number of jobs rose 5.3%, 9.2% and 6.5% respectively.

5. Oregon
> Unemployment decline from recession peak: 3.0 percentage points
> Peak unemployment: 11.6%
> Current unemployment: 8.6% (tied-12th highest)
> GDP growth 2011: 4.7% (2nd highest)

Just before the recession hit, in November 2007, Oregon’s unemployment rate of 5.3% was one of the highest in the country. That month, there were roughly 102,000 unemployed people looking for work in the state. By May 2009, Oregon’s unemployment rate had reached 11.6% of the labor force, and more than 230,000 people were looking for work. While the state’s unemployment rate remains high, it is now a full three percentage points lower than its peak rate two years ago. In each of the past two years, the state’s GDP growth rate has been among the highest in the country. In 2011, Oregon’s 4.7% economic growth well outpaced the national rate of 1.5%.

6. Florida
> Unemployment decline from recession peak: 2.9 percentage points
> Peak unemployment: 11.4%
> Current unemployment: 8.5% (14th highest)
> GDP growth 2011: 0.5% (14th lowest)

Florida’s unemployment rate reached a historic high in February 2010 when 11.4% of the workforce was unemployed. This was a 6.9 percentage point increase from November 2007, when the state’s unemployment rate was just 4.5%. Only one other state, Nevada, had a higher increase in unemployment in that time. A large part of the state’s decline came as the result of its collapsing housing market. From the second quarter of 2012, home prices are down by 43.8%, more than all but two other states. Since reaching its peak in February 2010, Florida’s unemployment rate has fallen by 2.9 percentage points, one of the largest declines in the nation. But the new jobs have not led to a meaningful increase in weekly earnings, which have risen just 1.4% from November 2007 to October 2012 — less than all but two other states.

7. Indiana
> Unemployment decline from recession peak: 2.8 percentage points (tied-7th highest)
> Peak unemployment: 10.8%
> Current unemployment: 8.0% (21st highest)
> GDP growth 2011: 1.2% (25th highest)

Indiana lost more than 6% of its jobs between November 2007 and October 2012, the third-largest decline in the country. The state’s unemployment rate has since declined by nearly 2.8 percentage points. Unfortunately for Indiana, this had less to do with added jobs and more to do with fewer people looking for work in the state. Since before the recession, the number of people in the labor force has fallen by more than 85,000, or 2.6%, the third-highest decline in the country. And as of October, 185,000 fewer people worked in the state than five years before. But there is some good news for the state. According to a survey conducted by the Kelley School of Business Indianapolis, most Indiana manufacturers have stabilized and plan on growing and investing in the coming months.

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8. Tennessee
> Unemployment decline from recession peak: 2.8 percentage points (tied-7th highest)
> Peak unemployment: 11.0%
> Current unemployment: 8.2% (tied-16th highest)
> GDP growth 2011: 1.9% (13th highest)

From November 2007 to April 2009, Tennessee’s unemployment rate doubled from 5.3% to 10.6%. Two months later, the unemployment rate peaked at 11%. But recently the state’s labor market has recovered. The number of manufacturing jobs, which steadily declined between 2002 and 2009 has rebounded somewhat, rising 3% over the 12 months ending in October. Tennessee’s unemployment rate as of October was 8.2% — 2.8 percentage points below the state’s peak rate, but still 2.9 percentage points above its November 2007 rate. The state has tried to grow its economy by limiting taxes — it had the third lowest state and local tax burden in fiscal 2010 at 7.7%.

9. Missouri
> Unemployment decline from recession peak:  2.8 percentage points (tied-7th highest)
> Peak unemployment: 9.7%
> Current unemployment: 6.9% (tied-21st lowest)
> GDP growth 2011: 0% (8th lowest)

Missouri weathered the recession especially well. The state’s unemployment rate rose from 5.3% in November 2007 to 6.9% in October, after peaking at 9.7% in August 2009. This was among the nation’s overall smallest increases over the five-year period. Between August 2009 and October 2012, the state added a net of 20,000 jobs. Although most sectors did not grow much, one that recovered especially well was professional and business services. Over the course of 12 months ending in October 2012, the sector added over 21,000 jobs. The number of mass layoffs also declined from 551 in 2009 to 375 last year, with just 224 such events in the first 10 months of 2012. Despite these improvements, Missouri has struggled to boost its economy in recent years, with GDP growth below the national average rate in each year from 2009 to 2011.

10. Arizona
> Unemployment decline from recession peak: 2.7 percentage points
> Peak unemployment: 10.8%
> Current unemployment: 8.1% (tied-18th highest)
> GDP growth 2011: 1.5% (18th highest)

Arizona’s unemployment rate rose from 4% in November 2007 to a recession high of 10.8% two years later. From November 2009 until March 2010, the state’s unemployment rate remained unchanged. Through October 2012, the state had lost more than 100,000 construction jobs — nearly half the sector — over a five-year period. However, the labor market has improved somewhat from the height of the recession. As of October, the state’s unemployment rate was 2.7 percentage points lower than its peak rate, while average weekly earnings were up 17% from November 2007, the seventh-highest increase in the nation.