Three States See ‘Significant’ Rise in Job Losses

In January, the unemployment rate increased most notably in Connecticut, Rhode Island and Washington, data from the U.S. Bureau of Labor Statistics showed—with each state registering higher jobless rates than the national rate.

Those states saw “significant” unemployment rate changes from December to January as jobless rates ticked up by 0.2 percentage point each—to 4.4 percent for Connecticut, 4.6 percent for Washington and 3.6 percent for Rhode Island. California’s jobless rate increased by 0.1 percentage point to 5.2 percent, one of the highest in the country. The Golden State has been hit with layoffs as companies, particularly those in the technology sector, have recalibrated their hiring in an environment of tighter monetary conditions.

The U.S. has seen borrowing costs rise to their highest in more than two decades after the Federal Reserve hiked rates to battle soaring inflation. The policy move has elevated the cost of loans, affecting business investment along the way. However, companies have unexpectedly kept hiring and have had a relatively small number of layoffs.

The national unemployment rate increased to 3.9 percent in February, compared to 3.7 percent in January. It has remained below 4 percent for about two years. Part of the reason the jobless rate rose last month was because of an increase in workers entering the labor force, according to analysts.

Workers are also facing a job market that has millions of job openings, with few people quitting or being laid off, according to the Bureau of Labor Statistics. In January, there were almost 9 million unfilled positions, with 5.7 million employees recruited. Separations—which includes people who have quit or lost their jobs—totaled 5.3 million.

“The ratio of job openings to unemployed workers increased, pointing to stubborn excess demand for labor,” Nancy Vanden Houten, the lead U.S. economist at Oxford Economics, said in a note on March 6.

On a state level, North Dakota and South Dakota boasted the country’s lowest unemployment rates, with 1.9 percent and 2.1 percent, respectively. Meanwhile, Nevada at 5.3 percent and California at 5.2 percent had the highest jobless rates.

“In total, 16 states had unemployment rates lower than the U.S. figure of 3.7 percent, 7 states and the District of Columbia had higher rates, and 27 states had rates that were not appreciably different from that of the nation,” the Bureau of Labor Statistics said Monday.

The largest increases in the unemployment rate since January 2023 occurred in Maine and New Jersey—rising by almost one percentage point to 3.4 percent and 4.8 percent, respectively.

“Six states had over-the-year rate decreases, the largest of which were in Massachusetts and Wyoming,” both down 0.5 percentage point, data from the bureau showed.