LANSING, Mich. (AP) — Michigan’s unemployment rate rose to 7.3 percent in December, its highest rate of the year, as the state lost 15,000 payroll jobs compared to November.
State officials were quick to point out yesterday that the state’s annual employment rate of 6.8 percent for 2004 was lower than 2003’s rate of 7.3 percent, the first time the annual average jobless rate had declined since 2000.
But Michigan’s monthly unemployment rate remains high above December’s national rate of 5.4 percent. Michigan has had one of the worst unemployment rates among the states over the past year, ranking third-highest in November, when its unemployment rate was 7.0 percent.
Liz Boyd, spokeswoman for Democratic Gov. Jennifer Granholm, said the gap between the state and national unemployment rate has traditionally been even larger over the past three decades than it is now in years when the state’s economy lags the nation’s.
But she added that Granholm recognizes the importance of adding jobs, and will address how she plans to diversify the state’s economy in her Feb. 8 State of the State address. Granholm late next week may also release details of how she wants to change the state’s business tax structure.
“The governor is committed to improving the job climate in Michigan. That is why she is poised to unveil her business tax restructuring plan, which is designed to help attract job providers to the state, including manufacturers,” Boyd said.
Since December 2003, Michigan has lost 47,000 payroll jobs, or 1.1 percent of its total payroll jobs, according to the Michigan Department of Labor & Economic Growth. Manufacturing accounted for 17,000 of those lost jobs, while trade, transportation and utilities accounted for 13,000.
Manufacturing staged something of a comeback in December, adding 4,000 jobs as workers returned from short-term layoffs. The state lost 9,000 professional and business services jobs in December, while education and health services lost 4,000 jobs and construction lost 3,000.
Michigan State University economics professor Charles Ballard cautioned that monthly unemployment swings shouldn’t be given too much attention. He thinks it’s likely the state’s jobless numbers will begin to recede in 2005.
“It is still true that if the U.S. economy has a good year in 2005, Michigan’s economy will probably slowly improve,” Ballard said.
He added, however, that Michigan is going to continue to lag until its workers get better educated and the state becomes less reliant on manufacturing.
“We rank 39th among the 50 states in terms of percentage of our adult population that has a college degree, and we’re No. 10 among the 10 biggest states,” he said. “We’re not creating the kinds of workers that are going to provide the highest-value jobs in the economy of the next quarter century.”
After showing steady gains early in 2004, total payroll jobs generally have headed downward since May, with only two months showing gains, according to state figures. The only two sectors having more jobs than they did a year ago were professional and business services, which added 2,000 jobs, and other services, which added 1,000.