While Michigan is still grappling with the worst unemployment rate in the country, the city of Ann Arbor has managed to ride the wave of the recession with a lower unemployment rate than the rest of the state, due largely to the city’s focus on a technology-based economy rather than one rooted in the manufacturing industry.

In January 2010, the unemployment rate in Washtenaw County was the lowest in the state at 9.3 percent, while the unemployment rate for the entire state of Michigan was 14.3 percent, according to new statistics released by Michigan’s Department of Energy, Labor & Economic Growth.

Much of the success of Washtenaw County, and specifically Ann Arbor, in maintaining a relatively low unemployment rate can be attributed to the area’s diversification of industries, according George Fulton, director of the University’s Research Seminar in Quantitative Economics.

“We are still losing jobs, even if you are creating jobs,” Fulton said. “If you don’t create them rapidly to cover the people, the unemployment rate will stay up there. Ann Arbor is doing better than the state because of the mix of industries, particularly in the city area.”

According to the statistics, the number of jobs in Washtenaw County declined from 171,900 in January 2009 to 164,600 in January 2010 alone. In January 2010, the number of unemployed workers in the county increased from 12,900 to 16,800.

Fulton said that while he, and many other economists, predict that the rate of rising unemployment will decrease in the future, throughout 2010, it will continue to be high and have an adverse affect on people seeking employment.

The ability of Ann Arbor’s economy to adapt to changing industries and move away from the manufacturing sector is a strong contributor to its capacity to remain a stable city throughout the recession, Fulton said.

“The job prospects are not going to be quite as good as they have been in the past, but it all depends on what you are looking for,” Fulton said. “In terms of the state, Ann Arbor is doing as well as any place in the state, and it is probably going to do better in the future because its economy is targeted more toward the knowledge information-based economy, (and moving) more away from manufacturing.”

But not all Ann Arbor officials think the state should completely abandon its manufacturing-based background.

Ann Arbor City Councilmember Mike Anglin (D–Ward 5) said he still supports manufacturing as a central component to Ann Arbor’s success in the changing economy because he fears that too much of an emphasis on technology may not be as beneficial in the long run.

“I would like to see us as a state concentrate more on manufacturing (than) put all our eggs in one basket of high tech,” Anglin said. “I think the ultimate thing, as Ford has shown, is that the manufacturing sector will be our largest employer as it has been in the past and will move that way in the future.”

However, Fulton refuted this notion, stating that an educated workforce is the best bet for the state’s economy to recover.

“Anything to do with more knowledge-based industries are the ones that are going to be most successful down the road,” Fulton said.

But both Fulton and Anglin think the University’s presence in the city and its job stability has played a big role in keeping the Ann Arbor economy alive and in drawing people to the city and surrounding area.

“The presence of the University creates jobs in this area,” Fulton said. “The University has a positive economic impact on the area and on the state.”

Anglin attributed Ann Arbor’s low unemployment rate to the lower-paying jobs like retail that have been coming to the city, but said he thought this ultimately wouldn’t help the city recover from the recession or provide career opportunities for students.

“I think Ann Arbor was able to sustain a 9-percent (unemployment rate), which I think is a good deal of unemployment,” Anglin said.