Unemployment Rate Hits Highest Level Since 1983

April 3, 2009— -- Despite better-than-expected reports on everything from housing to manufacturing this week, recession-wary U.S. companies are still shedding hundreds of thousands of jobs. The government reported that the nation's employers cut 663,000 workers in March, pushing the unemployment rate up to 8.5 percent, the highest in nearly 26 years.

Since the recession began in December, 2007, 5.1 million jobs have been lost, with almost two-thirds of the decrease -- 3.3 million job cuts -- occurring in the last five months, the U.S. Bureau of Labor Statistics reported today.

"The ramifications of the financial crisis have been broadly spread across the whole country, wherever you are, whatever industry, whatever kind of job you have," said Steve Cochrane, managing director of Moody's Economy.com.

As widespread as the recession has been, however, its effects on employment have varied widely from region to region. Average state unemployment ranges from 3.9 percent in energy-rich Wyoming to 12 percent in Michigan, which continues to suffer as its auto industry declines (see chart below).

Among metropolitan areas, the swing is even wider: The U.S. Bureau of Labor Statistics, in its monthly survey of 372 metro areas, found unemployment rates as low as 3.5 percent but also as high of 24.5 percent. Below, a look the metropolitan areas with some of the lowest and highest unemployment rates in the nation.

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Oil prices have fallen. But for the cities of Houma, Bayou Cane and Thibodaux, the energy industry is still a large part of why this portion of southeastern Louisiana has an unemployment rate of 3.5 percent, the lowest in the latest BLS survey.

Oil and gas businesses such as drilling company Pride Offshore, the region's second-largest employer, account for much of the employment. But should falling oil prices continue to hurt the industry there, as officials expect it will, they're hoping that another growing sector in the area will help cushion the blow: shipbuilding and ship repair.

Boat service company Edison Chouest Offshore is building a $100 million shipyard at the Port of Terrebonne, a facility that will add 1,000 high-paying positions, according to Moody's Economy.com. Meanwhile, some companies once focused solely on oil and gas are focusing some of their resources on shipbuilding. Houma-based Gulf Island Fabrication, known for building oil drilling and production platforms, has expanded into tow-boat manufacturing as its oil platform business has slowed.

"We've been very fortunate to be able to diversify into that area and minimize our downtime in other segments of our businesses," Gulf CEO Kerry J. Chauvin said.

The company has managed to avoid job cuts for now, although "if things don't pick up," Chauvin said, layoffs may still happen.