The Geography of Unemployment

By Richard Florida

The
U.S. unemployment rate is nearly nine percent but varies widely by
gender, race, and also by state and metropolitan region. The
unemployment rate is up
in 44 of 50 states, according to new BLS estimates released yesterday.
Last month, 106 U.S. metros reported jobless rates of 10 percent or
more, while 90 had rates below seven percent, according to data from
the U.S. Bureau of Labor Statistics.

Greater Detroit posted the highest rate for large regions (those
with a million or more people), 14 percent. Ten other regions posted
rates in excess of 10 percent. The lowest levels of unemployment were
found in greater New Orleans, 3.3 percent and Oklahoma City, 5.6
percent. Greater Portland, Oregon saw the largest jump in its
unemployment rate (+6.5 percentage points), followed by greater
Charlotte (+6.2 points) and greater Detroit (+6.0 points).

Writing over at Economix, Ed Glaeser previously identified
the effects of manufacturing economies and human capital (the share of
people with a bachelor's degree or above).on the unemployment rate. But
how do these factors and others effect the change in the unemployment
rate? So, Charlotta Mellander and I decided to take a look the effects
of human capital and the occupational or classstructure on the change
in the unemployment rate over the past year or so.

Large increases in regional unemployment are heavily concentrated in
regions with a large percentage of working class jobs - that is, jobs
in industrial production, transportation, and construction. Working
class jobs are significantly correlated with change in the unemployment
rate (0.35)

Regions
with higher levels of human capital and higher percentages of the
creative class have fared considerably better. Both are negatively and
significant correlated with increases in the unemployment rate (the
correlation for each being roughly -0.3),

Interestingly
enough, regions with large concentrations of low-end, standardized
service jobs (like food prep, building maintenance, and personal
care services) also fare better than those with large working class
concentrations. (The correlation between the change in the unemployment
rate and the share of service class jobs is -0.26).

Many service jobs, by their very nature, are less amenable to global
competition or to off-shoring. It's hard to out-source the person who
cuts your hair, mows your lawn, or takes care of your children or an
ailing parent. But these jobs are typically lower-paying and less
secure than manufacturing jobs.

Here's a thought: Instead of bemoaning the loss of what were once
high-pay, family-supporting manufacturing jobs, why not consider ways
to upgrade these jobs that we seem to be retaining and in some cases
retaining even during this downturn.

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