Image: Employment office
David Duprey  /  AP
Six states — Massachusetts, Michigan, Nevada, New Jersey, New York and Oregon — each posted over-the-month gains of a full percentage point in their unemployment rates in December.
updated 1/28/2009 11:10:08 AM ET 2009-01-28T16:10:08

Rising unemployment spared no state last month, and 2009 is shaping up as another miserable year for workers from coast to coast.

Jobless rates for December hit double digits in Michigan and Rhode Island, while South Carolina and Indiana notched the biggest gains from the previous month, the Labor Department said Tuesday. A common thread among these states has been manufacturing industry layoffs tied to consumers' shrinking appetite for cars, furniture and other goods.

With tens of thousands of layoffs announced this week by well-known employers such as Pfizer Inc., Caterpillar Inc. and Home Depot Inc., the unemployment picture is bound to get worse in every region of the country, economists say.

The government said Wednesday the number of layoffs involving 50 or more workers across the country jumped by one-third in 2008 from the previous year, and the pace of job cuts appears to have quickened since then.

"We won't see a light at the end of the tunnel until 2010," said Anthony Sabino, a professor of law and business at St. John's University.

The number of newly laid off Americans filing claims for state unemployment benefits has soared to 589,000, while people continuing to draw claims climbed to 4.6 million, the government said last week. There's been such a crush that resources in New York, California and other states have run dry, forcing them to tap the federal government for money to keep paying unemployment benefits.

Aside from manufacturing, jobs in construction, financial services and retailing are vanishing — casualties of the housing, credit and financial crises.

The Labor Department said Wednesday 21,137 mass layoffs took place last year, up from 15,493 in 2007. That's the highest annual total since 2001, the last time the economy was in recession, and the second-highest since the department began tracking mass layoffs in 1995.

The department says more than 2.1 million workers were fired as a result of last year's mass layoffs.

Clobbered by problems at Detroit's auto companies, Michigan's unemployment rate soared to 10.6 percent in December. Rhode Island's jobless rate hit 10 percent, the highest on records dating back to 1976.

Those states — along with eight others and the District of Columbia — registered unemployment rates higher than the nationwide average of 7.2 percent, a 16-year high.

Major Market Indices

South Carolina and Indiana posted the biggest bumps in their monthly unemployment rates. Each state logged a 1.1 percentage point rise in unemployment from November to December.

In South Carolina, the unemployment rate bolted to 9.5 percent as laid-off textile, clothing and other factory workers found it difficult to find new jobs.

"The money I was making, I'd be hard-pressed to find a job paying that," said Gregory Smalls, a 49-year-old Columbia, S.C., resident who lost his more than $50,000-a-year job as a truck body shop manager when his department merged with a dealership's service department.

Indiana's jobless rate soared to 8.2 percent in December as workers were hit by layoffs in manufacturing — including at engine maker Cummins Inc. — as well as in construction and retail.

Many Indiana counties with high jobless rates are in the northern part of the state, which has been battered by layoffs in the recreational vehicle industry. Hundreds of workers have lost their jobs at RV makers such as Monaco Coach Corp., Keystone RV Co. and Pilgrim International.

Gayle Glaser, who owns the Shortstop Inn restaurant in Wakarusa, Ind., said those job losses have hurt her business, too.

"We just don't have the traffic here from the plants," she said. "All my customers coming in — they're all laid off."

States that have been spared the worst of the recession's pain tend to benefit from energy and agriculture production, while also having relatively minimal exposure to the housing and manufacturing busts.

Wyoming posted the lowest unemployment rate, 3.4 percent in December. It was followed closely by North Dakota at 3.5 percent and South Dakota at 3.9 percent.

In 2008, the country lost 2.6 million jobs, and in 2009 at least 2 million more jobs are forecast to disappear.

Minneapolis-based retailer Target Corp. said Tuesday that it will cut an undisclosed number of workers at its headquarters. Elsewhere, specialty glass company Corning Inc. said it would cut 3,500 jobs, or 13 percent of its work force, as demand slumped for glass used in flat-screen televisions and computers. And chemical company Ashland Inc. said it would eliminate 1,300 jobs, freeze wages and adopt a two-week furlough program.

Roughly 40,000 layoffs were announced on Monday by a string of companies, including Pfizer, Caterpillar and Home Depot.

To stimulate job growth and the broader economy, President Barack Obama and Congress are racing to enact a $825 billion package of tax cuts and increased federal spending, including money for big public works projects.

The U.S. has been mired in a recession since December 2007. It is on track to be the longest downturn since World War II.

Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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