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Job markets in battleground states may decide election

For months, political pundits have argued that President Barack Obama will have a tough time winning re-election with the national unemployment rate stuck stubbornly over 8 percent.

But with just weeks to go before Election Day, the jobless rates that matter are the ones in just a handful of states that are up for grabs.

Like economic conditions generally, the recession had a very uneven impact on job markets in various regions of the country. Midwest states mostly escaped the housing boom that led to the bust that brought on the Great Recession. Rising energy prices have lifted the economies of energy-rich states like North Dakota. The impact from the ongoing housing bust has been concentrated in a handful of states including  Florida and Nevada.

That’s why the health of the job markets in the key “battleground” states will likely have a greater impact than the national, headline number, which stood at 8.1 percent in September, and has stubbornly remained above 8 percent for 43 months, the longest stretch since the Great Depression.

Here’s a look at the job outlook in ten key states, as of August, based on the latest jobless data released by the government Friday.

Florida: 29 electoral votes/8.8 percent jobless rate

Of all the battleground states Florida carries the most weight. It’s the state, after all, where a few hundred dangling chads in 2000 swung its 29 electoral votes, and the election, in George W. Bush’s favor.

Florida has been among the hardest hit by the housing crisis and it's still digging out from a deep real estate hole. After a steady decline from a peak of 11.4 percent in early 2010, the unemployment rate has been falling gradually along with the national number. But the rate has been inching up this summer.

The state is still a toss-up, but the latest NBCNews/WSJ/Marist poll, taken last week, showed Obama and picking up 49 percent of likely voters, including those who are undecided yet leaning toward a candidate, with Romney at 44 percent and 5 percent undecided.

Ohio: 18 electoral votes/7.2 percent jobless rate

Hard-hit by the recession-driven manufacturing downturn, Ohio has seen some improvement as a pickup in car sales has helped boost orders for auto makers and parts suppliers dotting the state. Ohio’s unemployment rate peaked in 2010 and has steadily fallen below the national average to the current 7.2 percent rate.

But the drop has been for the wrong reasons: job creation has been much slower than the shrinkage in the state’s labor force as discouraged job seekers have left the state, retired, gone back to school or given up looking. Since peaking in early 2010, Ohio’s labor force has shrunk by 215,000 – or nearly 4 percent.

In last week’s poll, Obama led Romney, 50 percent to 43 percent, among likely voters in Ohio including those who are undecided yet leaning toward a candidate. One percent backs another candidate, and 6 percent are undecided.

North Carolina: 15 electoral votes/9.7 percent unemployment

In contrast to Ohio, North Carolina’s jobless rate is higher than the national average, for the opposite reasons. Job creation has gained steadily since the end of the 2007 recession; employers in the Tar Heel state have added 1.4 million jobs in the past three years, a gain of 3.5 percent. But thanks to an influx of workers attracted by all those new jobs, the labor force has swollen by 1.6 million. That’s kept the jobless rate higher than it would have been if the labor force had remained the same size.

Recent polling data are not available for the state.

Michigan: 16 electoral votes/9.4 percent unemployment.

Michigan was one of the states hardest hit by the near collapse of the auto industry in 2008, which is why the Obama campaign has gone to great lengths to take credit for providing the industry with government help. From a peak of 14.2 percent in mid-2009, the jobless rate has fallen steadily.

But only because, like Ohio, a big chunk of Michigan’s labor force has left the state’s job market.

While car sales may have rebounded in the past year, employment in Michigan is still half a million jobs below pre-recession levels. That’s slightly more than the 420,000 people who are no longer looking for work in the state.

The hollowing out of the state’s workforce continues. And after small but steady job gains, overall employment levels began falling again this spring. That sent the jobless rate back on the upswing in August – up 0.4 percent from July.

Still, the latest opinion polls show the president holding a solid lead in what is still considered a battleground state by political analysts. The president leads Romney, 52 percent to 38 percent, in the state Romney's father once serve as governor, according to the latest Detroit News/WDIV/Glengariff numbers.

Virginia: 13 electoral votes/5.9 percent unemployment

Virginia is one of the few states that escaped the recession largely unscathed. The state continues to enjoy a much better job market than the national average, largely because of the steady flow of government jobs and contracts to residents of Virginia's, Washington, D.C., suburbs.

The jobless rate peaked at 7.3 percent in January 2010, and fell steadily to 5.6 percent this summer, but as the pace of layoffs for federal workers has picked up, so has the state’s jobless rate. And with cuts in federal spending looming, that bright job outlook could darken next year.

In Virginia, Obama is ahead of Romney by five points among likely voters (including those leaning toward a particular candidate), 49 percent to 44 percent, according to last week’s NBCNews/WSJ/Marist poll.

Wisconsin: 10 electoral votes/7.5 percent unemployment

Unemployment in Wisconsin peaked at 9.1 percent in 2010 and has trended lower since the recession ended. But those gradual employment gains reversed course sharply beginning this spring, adding six-tenths of a percent to the jobless rate since April.

Colorado 9 electoral votes/8.2 percent unemployment

Colorado also has yet to recover the more than 100,000 jobs the state lost to the recession. With its workforce roughly unchanged, that slow job growth has recently nudged its jobless rate back up. Unemployment fell from a peak of 9.0 percent in November 2010 to 7.8 percent this January.

In both Colorado and Wisconsin, Obama is ahead by five points among likely voters, 50 percent to 45 percent, according to last week’s NBCNews/WSJ/Marist survey.

Iowa: 6 electoral votes/5.5 percent unemployment

Iowa largely escaped the housing boom that fed the bust and recession, but its job market still felt the blow. Going into the recession, the state had one of the lowest unemployment levels in the country, at 3.8 percent, though it rose sharply – to 6.3 percent – when the financial storm hit.

Since then, with a highly stable labor force, and steady gains in hiring, the jobless rate has fallen gradually, hitting 5.1 percent in June. But like many of the rest of the battle ground states, the headline rate has bumped up.

Despite the reversal, the president holds an eight-point lead over Romney, 50 percent to 42 percent, in the latest NBC/WSJ/Marist survey.

Nevada 6 electoral votes/12.1 percent unemployment

Like its housing market, Nevada saw one of the sharpest reversals of fortune in the jobs numbers when the recession sent the unemployment rate from a pre-recession 4.2 percent to a peak of 14.0 percent in October 2010. Since then, the recovery has been steady, but slow.

The president holds a slim lead over Romney, 49 percent to 46 percent, according to the latest CNN/ORC polling data.

New Hampshire: 4 electoral votes/5.7 percent unemployment

The Granite state also entered the recession with among the lowest jobless rates in the country, 3.4 percent, but also saw a sharp spike (to 6.7 percent) which has been gradually receding. By April of this year, the rate had fallen to 5.0 percent. But employment levels began rising again this summer.

Recent New Hampshire polling data is not available. 

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