Michigan's Unemployment Rate in May tops 14%

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According to the Detroit News, the jobless rate in Michigan reached 14.1% in May 2009---This compares to 9.4% in the entire United States in May.

The unemployment rate for Michigan was the highest in nearly 3 decades and comes as both Chryler and GM entered bankruptcy.

$25 + $25 + $25 + $25 = -$200

According to US News and World Report there are many people that are actually hurting more after the Congress and Obama approved giving unemployed workers collecting unemployment insurance an additional $25/week.

Essentially, for some people in some states who were collecting unemployment and food-stamp benefits---they found themselves making "too much money" to qualifiy for food stamps after they started receiving the $25/week bonus payments. So---that means for an incremental $100/month, these select few are actually receiving $300 less in food stamp benefits---hense 4x$25 = -$200.

BLS's Birth Death Model says that 1.2 million jobs were created in the last year

According to the Bureau of Labor Statistics almost 1.2 million jobs have been "born" since April 2008. I don't think I believe it.

First a little bit of information for why they use a Birth-Death model:

In 2008, the CES sample includes about 150,000 businesses and government agencies drawn from a sampling frame of Unemployment Insurance tax accounts which cover approximately 390,000 individual worksites. The active CES sample includes approximately one-third of all nonfarm payroll workers. The sample-based estimates are adjusted each month by a statistical model designed to reduce a primary source of non-sampling error which is the inability of the sample to capture, on a timely basis, employment growth generated by new business ormations.

There is an unavoidable lag between an establishment opening for business and its appearing on the sample frame and being available for sampling. Because new firm births generate a portion of employment growth each month, non-sampling methods must be used to estimate this growth.

In the last 14 months the BLS says that of the ~1.2 million jobs created, 156,000 have been in construction (doubtful with complete crash of the housing market), 153,000 in the "Trade, Transportation and Utilities industry, 200,000 in Professional & Business Services, and 458,000 in Leisure & Hospitality.

Call it intuition---but since the Great Recession started, I find it hard to believe that there have a net 1.2 million new jobs---I would think that there would have a been a net million job job losses---If you disregard, the net "births"---I believe the unemployment rate would be almost 1 percentage point higher (around 10.2%)---And if you believe that there have a net-reduction of jobs from small businesses, the unemployment could actually be closer to 11% (vs. 9.4% 'as reported' in May 2009).

Detroit's Unemployment Rate ~23%

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Data from the state of Michigan shows that the state's largest city--Detroit--is suffering from an incredibly high jobless rate. Almost 23% of Detroiters were unemployed in April 2009---This compares to almost 13% of all Michiganders being unemployed.

Detroit suffers from lackluster politicians, a poor school system and a high crime rate--with these persistant negative conditions, it's likely that the city's unemployment rate will continue to outpace both the state's and nation's average unemployment rate for years and years to come.

Update July 2009--Check out the latest Detroit Unemployment Rate Data Here

California's Unemployment Trust Fund $2.35 Billion underfunded

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According to California's Employment Development Department (EDD), the state's unemployment insurance trust fund is currently at a $2.3 billion deficit and is increasing the deficit by ~ $700million a month.

Things are likely to get worse for the state because its unemployment rate continued to climb in the month of May (not shown on the chart)--and is likely to continue to climb for a few months---So that means fewer employers paying taxes into the system, and more unemployed workers collecting benefits.