Economy: Unemployment rates in U.S. continue to decrease

Despite high inflation and the threat of recession, new unemployment claims in the United States decreased slightly week-over-week on Oct. 24.

WalletHub released its updated rankings for the States Where Unemployment Claims are Decreasing the Most.

According to WalletHub’s report, unemployment claims were lower in 25 states last week than the previous week, including Florida, West Virginia, Tennessee and Texas.

Eleven states, including South Carolina, Colorado, Kansas, Georgia and Indiana, had increased unemployment claims last week compared to the same week in 2021.

Unemployment claims were lower in all states last week compared to the same week in 2019, except Connecticut, Wyoming, Alabama, Nevada, Michigan, New York, Illinois, Minnesota, Idaho, Alaska, Rhode Island, Nebraska, Oregon, Utah, Colorado, Florida and Indiana.

Unemployment decreased the most last week in Kentucky, followed by New Hampshire, North Carolina, Arkansas and Tennessee. Unemployment decreased the least last week in Oregon, followed by Alaska, Rhode Island, Montana and Indiana.

WalletHub Analyst Jill Gonzalez explained when unemployment is expected to pick up again.

“Unemployment is expected to pick up again following this larger Fed rate hike. The chances of a sharp rise in unemployment in the U.S. over the coming year are high. The unemployment rate was expected to average 3.7 percent this year before rising to 4.4 percent and 4.8 percent in 2023 and 2024, respectively. That number has not been reached yet, so we should expect it fairly soon. Once unemployment does start to rise, the Fed should be able to pull back on its aggressive rate increases,” Gonzalez said.

Gonzalez also explained how a potential recession would affect unemployment.

“A potential recession would negatively affect unemployment significantly. Losing a job is never good, but when you combine it with such high inflation it can really become disastrous. Even Americans with jobs right now are struggling to afford essentials like food and gas. If those numbers to climb while more people become unemployed, we might see an economy in deep recession,” she said.

What do you make of the fact that there are more job openings than there are unemployed Americans?

“Unemployment is really no longer an issue since the country has recovered from much of the fallout of the pandemic,” Gonzalez said. “The next step might be looking to open up immigration to fill the surplus of jobs nationwide. Doing so would not only help businesses meet their needs, but would also drive additional economic growth.”

According to Gonzalez, red states fared better last week than blue states: 23 red states and 29 blue states on average.

“The lower the number of the ranking, the bigger the decrease in the state’s new unemployment claims was.”

The Mountain states have had the highest inflation growth in the last 12 months.

“Among Mountain states, Nevada’s unemployment claims have experienced the 20^th biggest decrease in the U.S. For the week of October 24, Nevada had 1,943 new unemployment claims, an 8 percent decrease from the previous week. On the other hand, unemployment claims in Montana have experienced a 29 percent increase for the same period,” Gonzalez said.