Unemployment rates in most states dropped last month -- but the Covid-19 spike could reverse that

US Treasury Secretary Steven Mnuchin pulled the plug on emergency Federal Reserve lending programs, drawing a rare rebuke from the central bank, which said they are needed to support the economy as the coronavirus pandemic continues to rage. CNN's Matt Egan reports.

Posted: Nov 22, 2020 7:31 AM
Updated: Nov 22, 2020 7:31 AM

State-by-state unemployment rates fell in 37 states last month, the Bureau of Labor Statistics said Friday. But the resurgence of Covid-19 infections could reverse the recent improvements.

The economy is still fragile after the record downturn in the first half of the year, and another hit doesn't bode well for 2021. JPMorgan became the first Wall Street bank on Friday to forecast a decline in gross domestic product -- the broadest measure of economic growth -- for the first quarter.

And that could reverse newly positive trends in unemployment. In October, labor market data was looking up: Illinois, for example, saw its jobless rate fall the most out of all states and the District of Columbia. It dropped by 3.6 percentage points, to 6.8% from 10.4%, in September on a seasonally adjusted basis.

That's a great development, but whether Illinois and other states can continue that trajectory is an open question.

Illinois's positivity rate for Covid-19 is currently at record highs and hospitalizations have surpassed the level reached in the spring, the state's government said when introducing its Tier 3 mitigation strategy. These restrictions, implemented Friday, limit gatherings and encourage people to stay home.

Economists are cautious not to read too much into monthly swings in economic data. But given the rising number of infections and the state of the overall economy, they see a clear risk for the coming months.

"As winter approaches I do anticipate an increase in unemployment across the food and beverage complex, leisure and hospitality industries, and transportation," said Joe Brusuelas, chief economist at RSM, who expects jobless rates to increase in select states because of the pandemic.

The health situation is deteriorating rapidly, forcing a growing number of small businesses to close, Gregory Daco, chief US economist at Oxford Economics, noted to CNN Business in an email.

"As virus fear resurges and local authorities gradually reimpose virus containment measures, mobility, activity and employment will falter," he added.

Nationwide, the unemployment rate fell to 6.9% in October. Improvements since the peak of 14.7% in the spring are undeniable. Even so, the country is still far from its pre-pandemic state and remains down some 10 million jobs from February.

Hawaii and Nevada, both of which rely heavily on tourism and hospitality, continue to have the highest unemployment rates in the country, at 14.3% and 12% respectively.

California Coronavirus Cases

Data is updated nightly.

Cases: 1114524

Reported Deaths: 18726
CountyCasesDeaths
Los Angeles3645207438
San Bernardino845311129
Riverside806761400
San Diego71648968
Orange696941554
Kern38316445
Fresno35973471
Sacramento33133546
Santa Clara30676463
Alameda27485499
San Joaquin24649503
Contra Costa22412258
Stanislaus20370416
Tulare19752303
Ventura18040174
Imperial15053353
San Francisco14445158
Monterey13886113
San Mateo13203169
Sonoma11428155
Merced10986176
Santa Barbara10922133
Kings1003886
Solano934980
Marin7518128
Placer577867
Madera571480
San Luis Obispo561835
Yolo419975
Shasta409542
Santa Cruz389827
Butte366459
Napa275717
Sutter263813
El Dorado19304
San Benito174115
Yuba173210
Lassen14803
Tehama143523
Mendocino138522
Nevada10189
Lake83218
Glenn8296
Humboldt7309
Tuolumne7088
Colusa6426
Mono4993
Siskiyou4951
Amador45016
Calaveras43421
Inyo28316
Del Norte2731
Plumas1770
Trinity1130
Modoc1110
Mariposa1042
Alpine420
Sierra170
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Mostly sunny & dry weather is ahead for your Monday. The potential for showers will return to mostly mountain areas late Tuesday night through Wednesday .We'll be drying back out for Thanksgiving.
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