Cities where unemployment is double national rate

AP

El Centro, Calif., is a border city, and its economy relies heavily on agriculture -- an industry that has shed jobs since the beginning of the recession.

By Michael B. Sauter and Charles B. Stockdale, 24/7 Wall St.

When the U.S. labor market is discussed, the national figures naturally take center stage. But the employment picture across the country can be very different -- not just between states, but from city to city, too. The recent jobs figures for February show a great variation among the country?s largest metropolitan areas. While some are doing extremely well, others are plagued with astronomical unemployment rates that are getting even worse.

The five worst-off metropolitan regions had unemployment rates of 17.6 percent or more in February -- more than double the national unemployment rate of 8.7 percent. Meanwhile, the five best regions had unemployment rates of 4.2 percent or less -- less than half the national average. 24/7 Wall St. reviewed the jobs market conditions in the five best and five worst-off cities.

Between February 2011 and February 2012, according to the Bureau of Labor Statistics, the non-seasonally-adjusted unemployment rate nationwide fell from 9.5 percent to 8.7 percent. In most of the nation?s largest metropolitan regions, the jobless rate followed a similar pattern. However, in 19 cities -- the majority of which are in New York State -- the jobless rate worsened rather than improved.

When examining just the cities with the highest unemployment rates, it is not surprising to find that they, too, are bucking the national trend, improving at a considerably slower rate than the national average. In one case, Yuma, Ariz., unemployment did not improve at all, and even got worse, increasing by 9.2 percent in one year.

Similarly, the regions with the lowest jobless rates generally improved at an even higher rate than the national average. This was the case in four of these five metropolitan regions. Unemployment in Midland, Texas, which already had the fourth-lowest rate in the country in February 2011, fell -- that is, improved -- by nearly 20 percent in 12 months.

While local jobs markets can vary wildly, depending on the regional economy, the state unemployment rate is usually a good indicator for the city. This helps to explain why four of the five cities with the highest unemployment are in California. The Golden State has suffered from high unemployment and currently has the third-highest jobless rate among all states. Conversely, the cities with low unemployment are in states such as Kansas and Iowa, which have extremely low unemployment.

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The reason most of these regions have the best or worst job markets has much to do with how hard they were hit during the recession. Four out of the five cities with low unemployment lost less than 5 percent of total jobs from their prerecession peak. All five of the regions with the highest unemployment lost at least 6 percent of jobs. Yuba City, Calif., shed 14.8 percent of its jobs during that period.

24/7 Wall St. reviewed the Bureau of Labor Statistics? Local Area Unemployment Statistics figures for February 2011 and February 2012. This survey includes labor force statistics such as the size of the labor force, the number of people employed, and the unemployment rate for 372 of the nation?s metropolitan statistical areas. All of the unemployment figures we use, including the national average, are not seasonally adjusted. We also looked at IHS Global Insight?s report on the number of jobs lost by these regions during the recession, and how many of these jobs are projected to recover by the end of this year.

These are the five cities with unemployment rates double the national average.

5. Visalia-Porterville, California

• February unemployment: 17.6 percent
• 12-month change in unemployment: -4.3 percent

The unemployment rate in Visalia-Porterville metropolitan area improved by only 4.3 percent from February 2011 to February 2012, nearly half the national average. This left the area with one of the highest overall unemployment rates in the country. The picture looks even worse considering that in the first two months of the year, the region shed 1,200 people from its labor force. The area also has one of the country?s weaker housing markets. In 2011, Visalia-Porterville had one of the highest foreclosure rates in the nation.

4. Yuba City, California

• February unemployment: 19.9 percent
• 12-month change in unemployment: -6.1 percent

In February 2011, the Yuba City metropolitan area had a jobless rate of 21.3 percent. This was, at the time, the third-highest rate of the country. By September, the unemployment rate had fallen to just 16.4 percent, but jumped again in the next six months to its current rate of just shy of 20 percent. This is partially due to an increase in the size of its labor force. The region has recovered a large part of its trade, transportation and utilities jobs, but could not offset the increase in the size of its labor force. The jobs markets in other sectors remain tight.

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3. Merced, California

• February unemployment: 20.0 percent
• 12-month change in unemployment: -4.8 percent

Merced, located in the San Joaquin Valley, was among the cities hit worst by the housing crisis and recession. Today, it remains one of three metropolitan areas with an astounding unemployment rate of 20 percent or more. Two factors are contributing to the region?s high unemployment. Not only has the labor force grown over the past six months, but the area also continues to lose jobs in a number of sectors. For example, over the past 12 months, jobs in the information sector and the financial activities sector decreased by 8.3 percent and 6.3 percent, respectively.

2. Yuma, Arizona

• February unemployment: 23.7 percent
• 12-month change in unemployment: +9.2 percent

Yuma not only has the second-highest jobless rate among the 363 metropolitan regions, but it is also one of just a handful of cities to experience an increase in unemployment over the last year. Its February, 2011 unemployment rate of 21.7 percent increased to 23.7 percent by February, 2012. During the recession, Yuma lost 11.1 percent of its labor force, and will have recovered only 10 percent of that by the end of this year. In the past year, while the area?s labor force has dropped significantly, the number of available jobs has dropped even more. The number of trade, transportation and utilities jobs -- the second-largest source of employment in the region -- has fallen by nearly 10 percent in the past 12 months.

1. El Centro, California

• February unemployment: 26.7 percent
• 12-month change in unemployment: -4.0 percent

The El Centro area has a mind-blowing unemployment rate of 26.7 percent, the highest in the country. This means that more than a quarter of the region?s labor force are unemployed. El Centro is a border city, and its economy relies heavily on agriculture -- an industry that has shed jobs since the beginning of the recession. El Centro also was hit particularly hard by the housing crisis, which caused many residents working in construction to lose their jobs. In the past 12 months, the manufacturing sector has eliminated 11.1 percent of positions -- the most of any sector.

Read the cities with half the national unemployment rate at 24/7 Wall St.'s site.

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