With the U.S. losing 140,000 jobs in December but the national unemployment rate holding at 6.7% compared to the nearly historic high of 14.7% at the peak during the coronavirus pandemic, WalletHub today released updated rankings for the States Whose Unemployment Rates Are Bouncing Back Most, along with accompanying videos and audio files, to illustrate which areas of the country have had the best recovery so far.
In order to identify the states with the best recovery in unemployment, WalletHub compared the 50 states and the District of Columbia based on four key metrics. We looked at the change in each state’s unemployment during the latest month for which we have data (December 2020) compared to December 2019 and January 2020. We also compared not seasonally adjusted continued claims in December 2020 to December 2019. Finally, we considered each state’s overall unemployment rate.
Below, you can see highlights from the report, along with a WalletHub Q&A.
| Bounced Back Most | Bounced Back Least |
| 1. South Dakota | 42. Texas |
| 2. Iowa | 43. Illinois |
| 3. Nebraska | 44. Massachusetts |
| 4. Vermont | 45. New Mexico |
| 5. Utah | 46. Rhode Island |
| 6. Alabama | 47. New York |
| 7. Arkansas | 48. California |
| 8. Montana | 49. Nevada |
| 9. Wyoming | 50. Colorado |
| 10. Indiana | 51. Hawaii |
Michigan comes in 39th.
| Overall Rank | State | Unemployment Rate (December 2020) | Change in Unemployment (December 2020 vs December 2019) | Change in Unemployment (December 2020 vs January 2020) | Not Seasonally Adjusted Continued Claims (December 2020 vs. December 2019) |
|---|
| 39 | Michigan | 7.3% | 98.4% | 64.6% | 239.2% |
To view the full report and your state’s rank, please visit: https://wallethub.com/edu/states-unemployment-rates/74907/
WalletHub Q&A
How concerned should we be that the economy lost jobs in December?
“We should be slightly concerned that the economy lost jobs in December, since it was the first time in eight months that we didn’t see growth. The drop was relatively small, though, and the overall unemployment rate remained steady at 6.7%,” said Jill Gonzalez, WalletHub analyst. “We should be more concerned if the losses continue. The best way to achieve job gains in the future is to support vaccination efforts as much as possible, because we cannot get the economy fully back on track until a significant portion of the population is vaccinated.”
Is there a big difference in the unemployment rate among various demographics?
“The unemployment rate does differ sharply among different demographics. The unemployment rate for white people is 5.9 percent, while it’s much higher, at 9.3 percent, for black people. The racial disparity is troubling, especially in the context of broader discussions of inequality that have taken place in the past year,” said Jill Gonzalez, WalletHub analyst. “The unemployment rate can fluctuate a lot by age, too; it’s only 5.3 percent for those ages 45 to 54, but 11.2 percent for people ages 20 to 24. It makes sense that people who have been in the workforce longer would have more job stability, but we should be concerned about the difficult conditions faced by young people.”
Many Americans have been unemployed for six months or more. What are some financial tips for people who fall into the long-term unemployment bracket?
“People who are unemployed for six months or more should first make sure they have exhausted all benefits or resources available to them, as some states may offer extended unemployment benefits,” said Jill Gonzalez, WalletHub analyst. “People who have run out of benefits and can’t fall back on savings should look critically at their spending and temporarily cut out anything that is non-essential, as well as look into whether they can get temporary relief on their bills through the biller’s hardship program. Some people may need to borrow money, but should avoid extremely costly options like payday loans unless absolutely necessary.”
Which state has experienced the biggest increase in unemployment vs. the beginning of the year?
“Hawaii has experienced the biggest increase in unemployment because the number of unemployed persons jumped by 201% from January 2020 to December, compared to the average increase of 44%,” said Jill Gonzalez, WalletHub analyst. “Hawaii’s overall unemployment rate is 9.0%, compared to the average of 6.7%.”
Which state has experienced the biggest decrease in unemployment vs. the beginning of the year?
“Iowa has experienced the biggest decrease in unemployment because it has seen an 18% decrease in the number of unemployed persons from January 2020 to December, compared to the average increase of 44%,” said Jill Gonzalez, WalletHub analyst. “Iowa’s overall unemployment rate is 3.3%, compared to the average of 6.7%.”
