The unemployment rate continues to decrease overall across the U.S. But certain industries are experiencing job losses — and those losses are more significant in some states than others.
GOBankingRates analyzed data from the Bureau of Labor Statistics, tracking the number of employees in non-farm industries in each state from August 2016 to August 2017, to see which states experienced the biggest employment drops in eight industries:
- Trade, transportation and utilities
- Financial activities
- Professional and business services
- Education and health services
- Leisure and hospitality
Keep reading to find out which states were the worst for employment in each of the sectors.
The construction industry includes workers who are responsible for the construction of buildings, engineering projects and trade contracting. The industry saw an increase in overall employment in the last year, but 16 states experienced employment drops in the sector. Interestingly, however, construction (and extraction) is one of the industries in the U.S. that pay more than they did 10 years ago.
This industry also had the largest percentage drop in employment in any state, with Iowa experiencing a 7.3 percent drop in construction industry employment since August 2016.
3. South Dakota
Construction industry employment in South Dakota dropped 2.9 percent in the last year. This could be due to the fact that fewer people are available to work in the industry, rather than a lack of available work.
In April, the Associated General Contractors of America reported that the state added about 1,000 construction jobs in the previous month, but the Associated Press reported that despite the demand, the construction industry was experiencing a shortage of workers.
“We’re busy as can be,” Corey Johnson, president of the Home Builders Association of the Sioux Empire, told the AP in April. But “we could use more people to help us get through this busy time.”
Nebraska also saw a 2.9 percent decrease in construction industry employment. Once again, this seems to be due to a lack of workers rather than a lack of jobs.
The Associated General Contractors of America 2017 Workforce Survey for the state found that 62 percent of construction firms were looking to hire for expansion in the next 12 months. But 85 percent said they were having trouble filling hourly craft worker positions, and 42 percent rated the local pipeline for supplying well-trained craft personnel as poor.
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Iowa has seen the largest drop in employment in the construction industry, with a 7.3 percent decrease in the last year. And it’s proof that a low unemployment rate has its downside.
Mike Tousley, executive vice president and general manager at The Weitz Company, an Iowa construction company, told industry website Construction Dive in September that the state’s low unemployment rate is actually hurting the construction industry.
“It’s always been hard to find workers in Iowa. The available pool of workers is small,” he said. “And not unlike a lot of other states, high school kids are attracted to other industries and don’t see construction as a great long-term career path.”
The manufacturing industry includes the production of all goods including food and beverages, textiles, metal products, computer and electronic products, transportation equipment and furniture. Dips in manufacturing industry employment might be due in large part to automation.
A recent study by economists Daron Acemoglu and Pascual Restrepo shows “large and robust negative effects of robots on employment and wages,” and one of the industries hit hardest by these changes is manufacturing.
3. West Virginia
West Virginia is among the worst states for the unemployed, found a GOBankingRates study.
West Virginia University President Gordon Gee cited two big reasons for the state’s 3.2 percent drop in employment in the manufacturing industry over the last year. He believes it’s due to the state’s low workforce participation rate and the high rate of drug overdose deaths, meaning there are fewer people willing and available to work.
The state had a labor force participation rate of only 53.2 percent in 2016, so only about half of the population was either working or actively seeking work, according to WorkForce West Virginia. Additionally, West Virginia has the highest rate of death due to drug overdose in the country, with opioids being the biggest driver of those deaths, according to the latest data from the CDC. Drug addiction could be a factor in why people are not working.
2. New York
New York experienced a 4.3 percent drop in employment in the manufacturing industry. Syracuse.com noted that manufacturing has declined more than any other industry in Central New York, with job loss being caused by manufacturers automating and leaving the region.
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Employment in the manufacturing industry declined the most in Vermont, which saw a 4.4 percent decrease in the last year. Vermont’s largest manufacturing subsector is computer and electronic parts, with GlobalFoundries being one of the biggest employers in this sector.
The company — which employs 2,600 people in the Essex Junction, Vt., area — has been suffering from financial issues, and has had two rounds of layoffs in the last year alone, the Burlington Free Press reported.
Trade, Transportation and Utilities Industry
In this category, the BLS includes:
- Wholesale and retail trade jobs
- All forms of transportation and transportation warehousing
- Power, gas, water and sewage system workers
Employment increased overall in this industry over the last year — but not all states experienced a rise in employment in this category. However, overall drops in employment were low, with all states experiencing at most a 3 percent drop in employment in this industry.
Oklahoma had a 2 percent employment drop in the trade, transportation and utilities industry in the last year. This drop is likely concentrated in the utilities sector, as the state has had a rise in unemployment since the latest oil and natural gas slowdown started in late 2014, The Oklahoman reported.
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Employment in the trade, transportation and utilities industry dropped 2.9 percent in Delaware. Gov. John Carney told Delaware Public Media that he believes the rise in the state’s jobless rate might be due to the fact that older workers are retiring and employers are struggling to find workers with the skills to fill these roles.
1. West Virginia
West Virginia also experienced a 2.9 percent employment drop in the industry. This is one of two industries for which the state has had some of the highest rates of job loss. This might be due to the overall rise in unemployment across the state — in the last year, 49 of its 55 counties saw a rise in unemployment.
Financial Activities Industry
The financial activities industry includes all finance and insurance jobs as well as real estate, rental and leasing jobs.
Most states saw a rise in employment in these categories, but 10 states did see slight decreases in employment. In some cases, this might be due to overall drops in employment in these states rather than a specific cause within the industry.
Employment in the financial activities industry dropped 2.5 percent over the last year in Alaska. Alaska Public Media predicted in January that this industry would take a hit in 2017 due to a slowdown in the real estate market and a subsequent slowdown in the demand for financing.
The predictions have come to fruition, as a Nationwide study showed that Alaska has the least healthy housing market in the nation. The housing market in Anchorage has softened, which would account for a decrease in real estate, home financing and home insurance sales jobs.
Maine saw a 2.6 percent decrease in financial activities industry employment from August 2016 to August 2017. This might be due to the fact that unemployment in Maine has risen overall in recent months. In March 2017, unemployment in Maine dropped to 3 percent — the lowest it’s been in over a decade — but in August it had gone back up to 3.8 percent, according to Maine Department of Labor statistics.
Believe it or not, Hawaii is one of the top five states for the unemployed. But over the last year, it had the largest decrease in employment in the financial activities industry, with a 3.2 percent drop. This might be due to a lack of skilled and available workers rather than a scarcity of jobs.
Hawaii Business reported that some Hawaiian neighborhoods have an unemployment rate of over 10 percent despite many job openings in the state. The reasons many people remain unemployed include not having the necessary skills, or having additional challenges such as mental illness, substance abuse, criminal records or suspended driver’s licenses. Other reasons include a lack of access to affordable and dependable child care, and a shortage of jobs readily accessible by public transportation.
Professional and Business Services Industry
The professional and business services industry includes legal services, scientific research, architecture, accounting, advertising, design, management, administrative, support and waste management jobs.
As with the financial sector, job loss in this category seems to follow overall employment trends in the states with large drops rather than a particular event or an industry-specific cause.
Maine’s 1.7 percent employment drop in the professional and business services industry puts it in the top three states for job losses in two separate industries. Maine’s population has been dealing with a decline in secure, well-paying jobs over the last decade due to the loss of shoe and textile industries in the state, as well as the shutdown of paper mills, the Bangor Daily News reported.
When major companies shutter their local manufacturing plants, it means a loss of jobs for many management and administrative employees, which could account for this decrease.
Mississippi’s professional and business services industry had a 2.2 percent decrease in employment in the last year. This could be due to an overall decline in population. From 2015 to 2016, Mississippi was one of only eight states that saw a decrease in its population, the Sun Herald reported.
Wyoming tops the states with the biggest employment drop in the industry, with a 3.4 percent decrease. Wyoming lost jobs across nearly all industries this year, with the exception of the mining industry, the Uinta County Herald reported.
This could be due to the state’s shrinking workforce. After the oil bust in 2016, 112,000 working people left the state, and less than 88,000 came in, making for a net loss of 25,000 workers, according to the Casper Star-Tribune.
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Education and Health Services Industry
Only one state experienced a drop in employment in the education and health services industry, a category that includes school employees, healthcare workers and social assistance employees. Healthcare employment is growing overall, and it’s one of the fields that currently offer the most job security — in most states.
Wyoming is the only state that saw a decline in employment in the education and health services industry, with a 0.7 percent decrease. This is likely due to the state’s overall declining workforce resulting from people leaving the state after oil prices dropped and natural gas prices stagnated.
Leisure and Hospitality Industry
The leisure and hospitality industry includes all jobs in the arts, entertainment and recreation fields, as well as accommodation and food service jobs — which are among the worst-paid jobs.
Only seven states saw dips in employment in this industry over the last year, and five of those states experienced drops of less than 1 percent.
Employment in the leisure and hospitality industry dropped 0.9 percent in Kentucky over the last year. One possible factor could be a loss of business from trade shows.
The Courier-Journal reported that the Kentucky Exposition Center has lost several major trade shows over recent years, costing over $50 million in annual business, which no doubt affects business at the surrounding hotels as well. This could lead to a loss of jobs in this sector, which includes entertainment and accommodation employees.
Kansas’ leisure and hospitality industry experienced a 2.4 decrease in employment. This is likely directly related to the state’s overall shrinking workforce. The number of workers in Kansas has decreased 3 percent over the past eight years, The Wichita Eagle reported.
Wyoming once again has one of the highest employment drops in the nation by industry, with a 3.6 decrease in employment in the leisure and hospitality industry. This is likely attributable to its shrinking workforce. While the loss of 25,000 workers in a year may not seem like a lot, it’s nearly 10 percent of the state’s total working population.
Government employees are often hit the hardest when a state faces budget cuts, and this was the case in two of the three states with the highest drops in employment in this category. This category includes civil servants as well as employees of public schools and hospitals. Employees who are affected by such budget cuts can take these steps to survive a layoff.
3. New Mexico
Due to the state’s budget crisis in recent years, Gov. Susana Martinez placed a hiring freeze on state government jobs. She also announced plans this summer to cut the human resources staff in government agencies by about two dozen positions.
By June 2017, the number of people employed by the state of New Mexico had reached a low compared to recent years, the Santa Fe New Mexican reported. Government employment has dropped 1.8 percent over the last year in the state.
Wyoming’s latest budget bill implemented a strict hiring freeze for state employees in May and also eliminated 319 employee positions between 2016 and June 2017. It also called on Gov. Matt Mead to identify an additional 90 government positions to eliminate, or find a way to save the equivalent amount by his new budget proposal in December, the Wyoming Tribune Eagle reported.
Overall, Wyoming’s government employment has dropped 2.4 percent since August 2016.
Hawaii experienced the biggest drop in government employment, with a 3.1 percent decrease over the last year. The decrease is largely due to a transition of state-run community hospitals to the private sector in Maui County, Big Island Now reported.
In July, three hospitals in the county transferred operations from the state provider, Hawaii Health Systems Corporation, to Maui Health System, a subsidiary of Kaiser Permanente, Hawaii News Now reported.
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States With the Biggest Employment Drops
Eight industries saw employment drop in several states between August 2016 and August 2017, defying the overall rise in employment countrywide. The factors driving the decline run the gamut, from automation and budget cuts to a lack of skilled workers.
About the Author
Gabrielle joined GOBankingRates in 2017 and brings with her a decade of experience in the journalism industry. Before joining the team, she was a staff writer-reporter for People Magazine and People.com. Her work has also appeared on E! Online, Us Weekly, Patch, Sweety High and Discover Los Angeles, and she has been featured on “Good Morning America” as a celebrity news expert.