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NE Michigan unemployment higher than state average

February 7, 2014
Jordan Travis , The Alpena News

Michigan's unemployment rate dropped to 8.4 percent in December, still higher than the national rate but lower than the previous month's.

That's according to the Michigan Department of Technology, Management and Budget, which tracks jobs numbers with the help of the federal Bureau of Labor Statistics. But in Northeast Michigan - in which the DTMB includes Alcona, Alpena, Cheboygan, Crawford, Iosco, Montmorency, Ogemaw, Oscoda, Otsego, Presque Isle and Roscommon counties - unemployment was much higher, at 11.6 percent in November and 12.6 percent in December. The work force shrunk by 1.1 percent to 82,500, and the number of unemployed rose 7.2 percent as well.

Those numbers look especially bad when compared to the Holland and Grand Haven metropolitan areas, which had 5.6 percent unemployment for both months and a slight increase in its work force, DTMB figures show.

Article Photos

News Photo by Jordan Travis

Why is unemployment in Northeast Michigan so stubbornly high, and why is there so much variability within the region - a seasonally unadjusted 19.5 percent in Presque Isle County for February 2013, but 10.9 percent in Alpena County for the same month?

For one, the region typically has high unemployment rates during the winter months, even when the economy is booming, DTMB Economic Analyst Jim Rhein said. The summer tourism season boosts hiring in the summer, and construction and retail hiring drops during colder months.

Terry L. Basel, business services coordinator for the Michigan Works Northeast Consortium, agreed.

Fact Box

Northeast Prosperity Region Job Statistics (Alcona, Alpena, Cheboygan, Crawford, Iosco, Montmorency, Ogemaw, Oscoda, Otsego, Presque Isle and Roscommon counties)

Total population, 2012 estimate: 205,830

Percent change since 2000: -4.5

Labor force participants in 2013: 84,900

Percent change from 2009: -7.6

Industry payroll jobs: 57,075

Top five industries by employment:

Retail Trade: 10,825 jobs, 19 percent share

Health Care and Social Assistance: 9,950 jobs,

17.4 percent share

Accommodation and Food Services: 6,350 jobs,

11.1 percent share

Manufacturing: 5,125 jobs, 9.0 percent share

Public Administration: 4,400 jobs, 7.7 percent share

Source: Michigan Department of Technology,

Budget and Management

"We have a lot of places that people like to come to play, but not a lot of places for people to work," she said.

The consortium covers "Mackinaw City to Grayling, over to Lake Huron," Basel said. There's not much big industry in this region, although the industry the area does have is starting to grow again. They're typically suppliers to larger industry around the state and country, so as the global markets fluctuate, so does their business.

Northeast Michigan is a series of somewhat isolated counties with smaller populations, Rhein said. The region has fewer opportunities in general, so it's harder for workers to find a new job if they lose theirs.

"That tends to historically push rates up in these areas overall, not just in the winter," he said.

Krista Binkley has seen this first-hand, she said. While applying for jobs at the Michigan Works resources room in Alpena Wednesday, she said there are lots of openings posted online for downstate jobs. She had been working sales for Fastenal until the end of November, and now she's looking for something similar or possibly a receptionist job.

"It's tough, there's not much out there," she said.

Binkley's not alone. Many of her unemployed friends are having trouble finding jobs, she said, and have been applying at fast food restaurants and similar places. So far, Binkley's sent out 60 to 80 applications, including a few Wednesday, and had an interview Tuesday. However, they told her the job might be 13 hours per week.

"It's part-time because of the whole Obamacare thing, so I think that's affecting it," she said.

Basel said this isolation can exacerbate joblessness for another reason. The region has lots. Someone who lives in Rogers City might find a job opening in Alpena, but if it doesn't pay enough, it's not worth the commute.

Alpena County is something of an exception compared to its neighbors, Rhein said. In 2012, Michigan had an annual unemployment rate of 9.1 percent, with Alpena County's only slightly higher at 9.3. Preliminary figures show Michigan had a seasonally unadjusted unemployment rate of 8.8 percent for 2013, with Alpena County's at 7.8 percent.

"Considering these areas, that's not statistically that different," he said.

The difference in opportunities between Alcona, Alpena, Montmorency and Presque Isle counties is evident in the size of their labor forces. In Alcona County the labor force peaked for 2013 at 4,155 people in June, in Montmorency it reached 3,644 in June and in Presque Isle County the high was 6,154 in July, according to seasonally unadjusted DTMB figures. Those are all a fraction of Alpena County's labor force, which topped out at 13,660 people in May.

Northeast Michigan also has an older work force, with a median age of 56, Basel said. It shows that many younger workers are moving out of the area.

And as they leave the area, they take their skills with them, Star Staffing account executive Pamela Richardson said. In turn, area employers who need people with these skills have a hard time filling openings.

"Too many people think they need to leave the area for the bigger cities in order to find careers, when in fact there are numerous employers looking for potential employees with specific skills that have left the area," she said.

Keeping these workers is one of several issues Basel and others are attempting to tackle through employer roundtable groups, she said. Businesses would like to work with local public schools and community colleges on "talent tours" in an effort to get more young people interested in the careers the area has to offer.

Another problem employers in the area face is a lack of what Basel called "soft skills." Businesses can find people with enough basic job skills to train, but they're lacking in other areas. They may show up late without notifying a supervisor or follow through when they say they'll do something.

Michigan Works is offering free classes to help those looking for jobs build on their employability, Basel said. These focus on interviewing and resume writing, work skills and what employers are looking for.

Unemployment is a ratio of how much of the civilian labor force is working versus how many aren't, according to the DTMB. Within the labor force, everyone who worked at least an hour for pay during the reference week for the survey, at least 15 hours unpaid at a family business or were temporarily absent for a variety of reasons counts as employed. Those who had no job but attempted to find one and could accept one if offered are counted as unemployed.

Not factored in are those who have stopped looking, Rhein said. It's a chief complaint about what the BLS calls U3, the most oft-cited unemployment statistic: As job seekers grow discouraged and leave the work force, the unemployment rate can shrink for the wrong reason.

"If you saw the rate go down in 2011 or 2012 (for Michigan), some of that had to do with folks leaving the labor force, and that is not a positive," he said, adding the state had a growing labor force in 2013.

Another rate includes those who have left the labor force and employees who have part-time work but want a full-time job, Rhein said. Called U6, it measures labor market stress and is typically higher than the unemployment rate.

Michigan's U6 average for 2013 was an estimated15.3 percent, according to BLS data. It's still high, Rhein said, but better than before; in 2009, during the worst of the recession, that average hit 21.5 percent.

For those seeking relief, the situation may be getting better. Richardson said her firm has placed more people in the past year than in the previous three.

Jordan Travis can be reached via email at jtravis@thealpenanews.com or by phone at 358-5688. Follow Jordan on Twitter @jt_alpenanews. Read his blog, A Snowball's Chance, at www.thealpenanews.com.

 
 

 

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