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Hawaii, Michigan suffer biggest labor market setbacks in 2020

Hawaii, Michigan and New York registered the steepest declines in employment last year, underscoring the repercussions on the job market and economy from states employing stricter Covid-related business restrictions.

A sharp slowdown in travel and tourism resulted in a 13.8% slump in Hawaii’s payrolls in December from a year earlier, the biggest among U.S. states, a Labor Department report showed today. Michigan and New York, among states with harsher shutdown measures, saw employment declines that exceeded 10%.

At the same time, Mississippi, Georgia and Alabama — which remained mostly open throughout the pandemic — posted the fewest job losses.

The latest data give a more-detailed picture of the 140,000 jobs lost in December and explain the toll of the pandemic on state labor markets. Nationally, Covid-19 cases rose each week in December, prompting some states to introduce new lockdown measures.

Between November and December, Minnesota and Michigan reported the largest percentage declines in employment.

Over the year, Hawaii had the largest increase in the unemployment rate, which rose 6.6 percentage points to 9.3% in the 12 months through December. Colorado’s jobless rate jumped 5.9 percentage points to 8.4% and Nevada’s rose 5.5 percentage points to 9.2%. All are tourism-dependent states that have implemented business and travel restrictions.

Alabama and Utah, which have remained largely open since the summer, have unemployment rates below 4%.

Those states that rely on tourism, as well as those that have been especially hard-hit by the coronavirus, are counting on the rollout of the vaccine to restore economic activity. That said, distribution in the U.S. is running slower than planned, with cities including San Francisco and New York facing shortages.

President Joe Biden has called for a $20 billion national vaccination program to speed up the pace of Covid-19 immunizations as part of a wider proposal for economic and virus relief. While the funding should help speed up the pace of vaccinations, Biden will first have to get Congress on board before the plan can be implemented.

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