The latest jobs report for April indicates growth in the economy, with 253,000 nonfarm payroll jobs added, up from the previous month’s 165,000. Various sectors such as professional and business services, health care, leisure and hospitality, and social assistance also saw notable gains.
Currently, the U.S. unemployment rate is at a low of 3.4%, a significant improvement from the high of 14.7% in April 2020. However, there are concerns about inflation and the possibility of a recession, which could increase the unemployment rate if the Federal Reserve rate increases are insufficient.
To determine how unemployment rates are changing across the U.S., WalletHub analyzed data from the latest month available, April 2023, and compared it to key dates in 2023, 2022, 2020, and 2019, using six key metrics to evaluate the 50 states and the District of Columbia.
WalletHub released updated rankings for its report on Changes in Unemployment Rate by State:
Unemployment Change in New York:
- -1.68% Change in Unemployment (April 2023 vs March 2023)
- 385,005 unemployed people in April 2023 vs 391,595 in March 2023;
- 21st worst change in the U.S.
- -5.96% Change in Unemployment (April 2023 vs April 2022)
- 385,005 unemployed people in April 2023 vs 409,389 in April 2022;
- 16th best change in the U.S.
- -73.06% Change in Unemployment (April 2023 vs April 2020)
- 385,005 unemployed people in April 2023 vs 1,428,948 in April 2020;
- 18th worst change in the U.S.
- 4.11% Change in Unemployment (April 2023 vs April 2019)
- 385,005 unemployed people in April 2023 vs 369,791 in April 2019;
- 15th worst change in the U.S.
- -3.16% Change in Not Seasonally Adjusted Continued Claims (April 2023 vs March 2023)
- 164,653 continued claims in April 2023 vs 170,034 in March 2023;
- 17th worst change in the U.S.
- 4.0% Unemployment Rate (April 2023)
- 10th highest unemployment rate in the U.S.
WalletHub Q&A
With the summer coming up, how will seasonal jobs affect unemployment?
“With the arrival of summer, seasonal jobs should lower unemployment rates. However, given the current tight labor market environment, the hospitality industry will need maximum participation to fill open vacancies for the summer season,” said Jill Gonzalez, WalletHub Analyst. “Even before the summer season, many of these positions went unfilled, as job openings rose sharply over the last year or so. Because unemployment is already so low nationally, seasonal jobs will put more pressure on the job market and may even push inflation, forcing the fed to change its plans.”
How is artificial intelligence impacting unemployment?
“AI is impacting unemployment in various ways. On the one hand, AI is creating new jobs in fields such as data analysis, machine learning, and programming. On the other hand, AI is also causing job displacement as many tasks that were once performed by humans are now being automated,” said Jill Gonzalez, WalletHub Analyst. “Certain jobs in fields like journalism, higher education, graphic and software design are already at risk of AI replacement, and could lead to higher unemployment sooner rather than later.”
How do the recent banking collapses affect unemployment?
“The recent banking collapses can affect unemployment in a couple of ways. When a bank collapses, it can lead to a reduction in the availability of credit. As a result, businesses may cut back on their hiring, leading to an increase in unemployment,” said Jill Gonzalez, WalletHub Analyst. “Banking collapses can also lead to a loss of confidence in the economy, which can have a negative impact on consumer spending. A reduction in demand for goods and services might follow, which can in turn lead to a reduction in hiring.”
What are unemployment predictions for 2023?
“The U.S. economy is expected to grow very little in 2023. This would lead to a jump in unemployment to as high as 4.6 percent, according to the Federal Reserve. Both of these things would be signs of the Fed continuing to try and get a handle on inflation,” said Jill Gonzalez, WalletHub Analyst. “If this ‘worst-case scenario’ comes true, it could mean that millions of people who now have jobs could wind up unemployed.”
How does the threat of labor strikes affect the economy?
“The threat of labor strikes might have an interesting effect on the economy. With increasing support for unions, workers now are more likely to earn better pay and workplace benefits. This could lead to a reduction in things like stagnant wage growth and poor job quality for workers,” said Jill Gonzalez, WalletHub Analyst. “However, improved working conditions might come at a cost to the consumer, leading to overall economic slowdown. Strikes may also make inflation even worse, as the supply lines will get further disturbed.”
What qualities should unemployed people look for when choosing which businesses to apply to?
“The biggest thing that unemployed people should look for when choosing which businesses to apply to is compensation that’s appropriate for their field and skill level. Since there is currently an employment shortage, workers are in a great position to negotiate a worthwhile compensation package,” said Jill Gonzalez, WalletHub Analyst. “Other desirable features are the ability to work from home at least part of the time, measures to prevent the spread of COVID-19, a positive and friendly workplace environment, and a short commute.”
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 2.8%, while it’s much higher, at 4.4%, 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 2.4% for those ages 45 to 54, but 5.4% 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.”
Which state has experienced the biggest increase in unemployment vs. the previous month?
“The District of Columbia has experienced the biggest increase in unemployment because the number of unemployed persons jumped by 3% from March 2023 to April 2023, compared to the average decrease of 2.9%,” said Jill Gonzalez, WalletHub Analyst. “The District of Columbia’s overall unemployment rate is 5%, compared to the average of 3.4%.”
Which state has experienced the biggest decrease in unemployment vs. the previous month?
“New Hampshire has experienced the biggest decrease in unemployment because it has seen a 14% decrease in the number of unemployed persons from March 2023 to April 2023, compared to the average decrease of 2.9%,” said Jill Gonzalez, WalletHub Analyst. “New Hampshire’s overall unemployment rate is 2.1%, compared to the average of 3.4%.”
