Unemployment rates fall in nearly two-thirds of US states as hiring picks up nationwide

WASHINGTON – Unemployment rates fell in 32 U.S. states last month as employers nationwide added the most jobs of any month this year.

Jobless rates rose in just three states in October and were unchanged in 15.

The unemployment rate has tumbled below 4.5 per cent in 21 states, including Texas, Colorado, and Virginia. That’s a historically low level that may help push up pay in the coming months.

A hiring rebound in October added 271,000 jobs, the most this year. The national unemployment rate fell to 5 per cent from 5.1 per cent. Steady spending by consumers has offset slower growth overseas and encouraged businesses to add more workers.

Employers stepped up hiring in 40 states last month, the most since April. The biggest job gains occurred in California, which added 41,200, followed by Florida, with 35,200.

North Dakota’s unemployment rate of 2.8 per cent was the lowest in the nation, followed by Nebraska’s 2.9 per cent.

Very low jobless rates are becoming more common: The unemployment rate is 4.4 per cent in Ohio, down from 5.2 per cent a year ago; 4.4 per cent in Indiana, down from 5.8 per cent 12 months earlier; and 3.8 per cent in Colorado, down from 4.4 per cent a year ago.

When unemployment falls to such low levels, companies are typically forced to compete among a dwindling supply of those without jobs in order to hire. Or they have to make better offers to those who already have jobs to entice them to switch. In either case, average wage levels would rise.

The Federal Reserve cited many such examples of wage pressures across the country last month, according to its “Beige Book” report. The Beige Book consists of anecdotal reports of business conditions in the Fed’s 12 districts.

Overall, average hourly pay increased 2.5 per cent in October from a year earlier, the biggest annual gain since 2009. Still, that is below the roughly 3.5 per cent that is typical of a healthy economy.

Unemployment rates typically fall because of those out of work find jobs. But they can also drop if some unemployed become discouraged and stop looking for work, or because they go back to school to learn new skills.

Yet many of the states with low rates have seen solid job gains. Ohio added 30,800 jobs last month, the third largest increase in October.

And in the past 12 months, Utah and Idaho have reported the largest percentage increase in jobs nationwide. Utah’s unemployment rate is 3.6 per cent, and Idaho’s is 4 per cent.

Some states are still struggling: West Virginia’s unemployment rate has jumped to 6.9 per cent, the highest in the nation, from 6.1 per cent 12 months ago. Its coal industry has been hit hard by competition from cheaper natural gas. New Mexico’s jobless rate is 6.8 per cent, up from 6.2 per cent.