Cities where people can't find work

Mike Sauter
24/7 Wall
cities where people can't find work
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St. Thomas Mission in Yuma, Ariz. The city has the highest unemployment rate in the nation. (Photo credit: iStockphoto)

Despite many in the United States still feeling the pinch, there’s no denying that the job market is improving. Last week, the number of Americans seeking unemployment benefits fell to a five-year low of 330,000. The current unemployment rate, five years after the start of the Great Recession, was 7.8% last month. At the height of the recession, it was 10%.

Despite the fact the general job market is improving, the unemployment rate in certain metro areas continue to be awful. Based on the latest data available from the Bureau of Labor Statistics, 24/7 Wall St. reviewed the metro areas with the highest unemployment rates in the country. Yahoo! Homes is publishing the bottom five here; to see the rest, go to 24/7 Wall St.'s website:

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Two of the cities on this list, Atlantic City, New Jersey, and Ocean City, New Jersey, were in the path of Superstorm Sandy, which hit at the end of October of last year. Unemployment skyrocketed in November in both cities. In Ocean City, the jobless rate jumped from 11.8% in October to 14.5% in November.

Other metropolitan areas with high unemployment are located in southern or central California, or southern Arizona. These areas, unlike the New Jersey cities, have low income populations and extremely high poverty rates. In El Centro, California, which had the second-highest unemployment rate in the country of 27.5% in November, more than one quarter of the population is living below the poverty line.

According to BLS economist Tom Krolik, one of the characteristics that distinguishes these areas from the rest of the country is their disproportionately rural populations and the high proportion of people employed in the highly seasonal agriculture sector. In five of these regions, more than 10% of the working population was employed in the industry, compared to the less than 2% of workers nationwide. In Visalia-Porterville, California, which had an unemployment rate of 14.5% in November, close to one out of every five jobs was in agriculture at the most recent Census count.

Based on the latest monthly data collected by the Bureau of Labor Statistics for November, 2012 — the most recent month of available data by metropolitan statistical area — 24/7 Wall St. identified the 10 metropolitan statistical areas with the highest unemployment rates. We also included U.S. Census Bureau data for poverty, income, high school and college attainment levels, and employment by sector, all from 2011.

Here are the five cities where it is hardest to find work:

5. Atlantic City-Hammonton, N.J.
> Unemployment: 14.5% (tied-5th lowest)
> 12-month unemployment change: 2.2 percentage points
> Pct. below poverty line: 13.4%

Closed casinos and declining tourism hit Atlantic City hard following Superstorm Sandy, leading to a temporary surge in unemployment. The jobless rate in the metropolitan area rose 2.2 percentage points between November 2011 and November 2012, the highest unemployment rate growth of all U.S. metropolitan areas. Most of that jump in unemployment took place in the last month of that year due to the storm. Government officials and employment experts note that Atlantic City’s unemployment may go down in the coming months as construction workers flock to the area to rebuild after Sandy, which in turn could give the gaming industry a much-needed boost. The downside is many of these workers could come from out of state and may not stay in the area long-term.

Hotel in Merced, Ca. | Photo: Flickr: David Gallagher
Hotel in Merced, Ca. | Photo: Flickr: David Gallagher

4. Merced, Calif.
> Unemployment: 15.7%
> 12-month unemployment change: -0.7 percentage points
> Pct. below poverty line: 27.4%

Although Merced’s unemployment rate had fallen by 0.7 percentage points over the twelve months ending in November, at 15.7% its rate was still the fourth-highest among all U.S. metro areas. According to the San Francisco Chronicle, the Merced area, “historically has had a high unemployment rate because of seasonal employment swings in agriculture and a poorly educated population.” Many residents in Merced also lack a formal education. As of 2011, just 65.2% of the area’s residents had at least a high school diploma versus 85.9% for the U.S. as a whole.

3. Yuba City, Calif.
> Unemployment: 15.8%
> 12-month unemployment change: -0.8 percentage points
> Pct. below poverty line: 16.3%

Like many of the metropolitan areas with very high unemployment, Yuba City’s economy is very dependent on agriculture. Six percent of the area’s labor force works in agriculture, more than three times the proportion nationwide. Although the unemployment rate of 15.8% is still the third highest in the country, it is down from 16.6% in November 2011. One field driving this improvement is construction. According to a recent analysis by the Associated General Contractors of America, construction employment in the metropolitan area rose 24% between August 2011 and August 2012, more than all metro areas in the country.

2. El Centro, Calif.
> Unemployment: 26.6%
> 12-month unemployment change: -2.3 percentage points
> Pct. below poverty line: 26.8%

In November 2011, El Centro had an unemployment rate of 28.9%, then the highest of any metropolitan area in the U.S. Twelve months later, El Centro’s unemployment rate was still the nation’s second-highest, at 26.6%. Worse, because much of the area’s employment is seasonal, the unemployment rate has, since 2009, exceeded 30% in the late summer months. Without steady jobs, many area residents live in poverty. As of 2011, 26.8% of people in El Centro lived below the poverty line, one of the highest rates among all metropolitan areas and more than 10 percentage points above the 15.9% figure for the U.S. as a whole.

1. Yuma, Ariz.
> Unemployment: 27.5%
> 12-month unemployment change: 1.2 percentage points
> Pct. below poverty line: 21.8%

No metropolitan area’s employment situation is worse off than Yuma, where 27.5% of the labor force was considered unemployed in November 2012.Regional leaders point out that the winter months tend to spur employment in fields such as hospitality as people flock to the area to escape the winter cold. They also point out that agriculture jobs tend to be very seasonal in nature, with considerable temporary hiring taking place in the winter months. More than 10% of the metro Yuma labor force works in agriculture, compared with just under 2% of the U.S. population as a whole. Much like many other cities with a high unemployment rate, the Yuma area’s poverty rate is high. In 2011, 21.8% of the area’s residents lived below the poverty line, significantly higher than the 15.9% across the country. The median household income was also quite low at $38,390 — more than $12,000 below the national median.

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