Michigan lost an estimated 154,000 jobs in December, with nearly 40% of them coming in the leisure and hospitality sector.
The Michigan unemployment rate for December hit 7.5%, per new state data, marking the second consecutive month the rate has increased.
About 60,000 of the jobs were lost in the leisure and hospitality fields, which were hit hard by a partial shutdown of the economy starting Nov. 18. While most businesses have been allowed to reopen, restaurants are still closed for indoor dining through Jan. 31.
There were 416,900 leisure and hospitality jobs in December 2019. In December 2020, there were 217,900 filled jobs in the industry, down 199,000 in 12 months.
Nationally, the unemployment rate was 6.7% for both November and December.
Here’s a look at the monthly unemployment rate in Michigan throughout the year.
- 2019 average: 4.1%
- January 2020: 3.8%
- February 2020: 3.6%
- March 2020: 4.3%
- April 2020: 24.0%
- May 2020: 21.3%
- June 2020: 14.9%
- July 2020: 8.7%
- August 2020: 8.7%
- September 2020: 8.6%
- October 2020: 6.1%
- November 2020: 7.0%
- December 2020: 7.5% (preliminary)
The preliminary unemployment rate for all of 2020 is 9.7%, although the number could be tweaked. It’s the highest Michigan’s unemployment rate has been since 2011, when it was 10.4%. The rate had declined every year since 2009 – when it was 13.7% – until this year.
The high unemployment rate means Michigan won’t increase its minimum wage in 2021. It was supposed to increase from $9.65 to $9.87 per hour on Jan. 1, but state law postpones a hike for a year if the annual unemployment rate is above 8.5%.
Pandemic impact on holiday season
Only one sector in Michigan saw a notable increase in jobs in December – the trade, transportation and utilities industry. This group had a net increase of 8,000 jobs, which the state says is because of the holiday shopping season.
December was a better month than November for a chunk of Michigan retailers, per the Michigan Retailers Association. About 47% of retailers surveyed by the MRA had an increase in sales in December, while 39% had a decrease and 14% reported no change.
“Michiganders know how vital it is to support local and they proved that by showing up for retailers this holiday season” said Bill Hallan, president and CEO of the MRA, in a news release. “This nice boost over November sales will give retailers more hope and help financially during the first quarter of 2021.”
Retailers are split on what the next few months will bring – with 42% expecting sales will go up and 41% expecting a dip.
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