Michigan’s January jobs report held a mixed bag as the state gained jobs but enough to not enough to stave off an increase in the state’s monthly unemployment to 5.3%. That’s an increase of one-tenth of a percentage point from the December rate.
The report was released Thursday by the Michigan Center for Data and Analytics.
Michigan’s unemployment rate remains higher than the national average of 4%, in part because the state’s economy relies so heavily on manufacturing for jobs. The report says Michigan lost 4,000 manufacturing jobs in January and 20,000 manufacturing jobs in the previous 12 months.
“The number of unemployed people in Michigan is going up. It has been going up for the past year or so. That’s not unexpected with the news we’ve been hearing with the weakness in manufacturing and retail trade,” said Michigan Labor Market Information Director Wayne Rourke. “Those are particularly weak industries for Michigan right now.”
Michigan also gained jobs in January, led by private education and health services. Rourke said a part of the increase in the unemployment rate is people joining the workforce hoping to find jobs.
Rourke said the fight over possible federal layoffs is in the news but those would not have an immediate direct impact on Michigan’s employment numbers.
“The federal workforce in Michigan, while it’s about 58,000 workers, is only about 1% of our total jobs in Michigan, so you’re not going to see any really any significant impact in the data if there is layoffs in that industry,” he said. “It’s one of our smallest industries.”
The controversy over tariffs and a budding trade war is roiling markets, but University of Michigan economist Gabriel Ehrlich said it will take a while to see how that affects employment.
“I would expect the tariffs, really, to take more time to have a meaningful effect on the jobs numbers,” he said, and noted the period covered in the January report was before the Trump administration made most of its announcements regarding trade and employment.
“So, I would expect the tariffs would really be more of a concern on a forward-looking basis,” he said.
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