Unemployment 'is now a national emergency'

WASHINGTON -- More than 1-in-10 workers were unemployed in four U.S. states in January, the government said Wednesday in a report that pointed to a rapid deterioration in the job market.

The unemployment rate in Michigan was 11.6%, up 4.3 percentage points from a year earlier and the highest for any state, the Labor Department said. The unemployment rates in California, Rhode Island and South Carolina rose in January to top 10%. That was the first time those states had jobless rates in the double digits during this recession, which began in December 2007.

Rhode Island, at 10.3%, and Georgia, at 8.6%, recorded the highest unemployment rates in their states since such records began in 1976.

Twenty-two states and the District of Columbia saw their unemployment rates jump by a percentage point or greater from December to January, showing how quickly the job market is worsening. It's been more than two decades since at least four states had unemployment rates of 10% or greater.

"The jobs situation is now a national emergency, because the huge number of layoffs are not only hurting those directly affected, but are intensifying fears among those still employed that they may be next," Radnor International Consulting President Larry Chimerine says. "This is creating more downward pressure on (consumer) spending, making the recession even worse."

Nationwide, the jobless rate was 7.6% in January before rising last month to 8.1%, the highest in more than 25 years. The percentage of Americans out of work is expected to continue to rise throughout 2009 and perhaps beyond.

The unemployment rate typically rises even after a recession ends as employers seek to cut costs and wait for tangible evidence the economy is on the mend before hiring again. Plus, people who got discouraged and stopped looking for work when times were bad tend to re-enter the workforce when there are signs of improvement. That tends to boost the jobless rate.

"It's typically about a year after a recovery has begun before we see the jobless rate peak out," says Richard DeKaser of Woodley Park Research.