The graph of the day is here at ZeroHedge. Go on over and take a look at it.
The graph illustrates the deviation of the unemployment rate from average by state over the period of the last 36 years, since 1976.
There’s a lot of information there presented in a very compact format and, frankly, it’s hard to digest. I strongly suspect that this illustrates what is likely to drive American politics today and for some time to come.
Here’s a direct link to the chart for those that have trouble viewing it on Zero Hedge.
Incidentally, I relly don’t believe that drop in the Florida numbers in recent months. That’s only falling because of people “dropping out” per orders. I met two more unemployed engineers last Monday night, one electrical, one aerospace.
Yes, I’ve not seen a graph quite like that before. (and the thread was entertaining)
That said, it seems hard to not conclude that as a general proposition the business and tax friendly states are doing better. It’s clear you need to be careful to consider the real estate bust, and now the energy boom in, say, Dakota, or NY’s special status as a financial hub, but that seems to be the general thrust. This graph really doesn’t vary in broad strokes from population migration statistics showing that states like IL, MI, CA etc are shooting themselves in the foot while the southeast, TX etc are the net winners.
5 worst losers in order**- Nevada, Rhode Island, California, DC and North Carolina.
5 biggest winners- North Dakota, Nebraska, South Dakota, Vermont and Oklahoma.
None of the biggest winners are in the Southeast. One of the big losers is there. If you look at the next 5 winners, 3 are from north of the Mason Dixon line. If you look at the next 5 losers, 4 are from the southeast, Georgia, South Carolina, Mississippi and Florida.
I guess we all see what we want to see. What I see is that it is not good in states affected heavily by the real estate crash, it is good to live in states with energy production and I dont know what is going on in Vermont. I was also surprised about DC.
** I am using his ordering system, which looks to be based mostly on the most current number, otherwise Michigan should be in there.
Steve
Interesting chart. I looked at my home state of Colorado and wasn’t surprised. The 1980’s were a sucky time for us then. If you notice the late 1970’s, early 1980’s bubble, that is from energy. We had a ton of asshole Texans coming up for a shale-oil boom. Downtown built several new highrises and a lot of investments were made. That all crashed when the price of oil collapsed. We didn’t really feel Reagan’s economic miracle and my Dad lost almost everything he had.
The 90’s boom was driven by high-tech and tourism mainly. That petered out with the dot com collapse, but didn’t affect Colorado as bad as other states. For the last few years it’s been the technology sector along with the influx of a lot of people fleeing places like California.
50 stories in that chart, but I’d be cautious in making comparisons without understanding the cause-and-effect for the highs and lows.
Drew’s favorite song lyric:
I think you’ve got a Rorschach* Test there. The winners have miserable weather, the losers have generally milder weather. The winners are more rural than the losers. The winners are also smaller states. Or states that have already lost all their population to the “losers.” Or states where no sane person would ever live. Or are more predominantly white.
*I can never remember how that damned word is spelled. Evidently my single year of German did not stick. Although I can tell you where the orchestra practice is.
Good job. Nailed it the first time.
Michael- Never read The Watchmen? A lot of those old comic books and graphic novels had a surprisingly good vocabulary.
Steve
Dave:
Riiiiight. Certainly I didn’t try three times, fail, then type it into Google. Because that would be cheating.
Steve:
I read it after seeing the movie, actually. I often cite comics to my editors when they suggest I’m using overly ambitious words. Although my other response is, “They can Google it if they don’t understand it.” (See above.)
Interesting to see comments about seeing what one wants to see, when I do believe I’m the only one who qualified my remarks by special situations or issues, and also spoke about well publicized population migration statistics.
Ignore TX, or the SE migration if it suits your worldview, but as an investor I can’t afford such blindness. If you guys have a mirror you need to go look into it.
“Ignore TX, or the SE migration if it suits your worldview”
Then why do nearly all the southeast states in this chart do worse than average? Only Alabama, Louisiana, Virginia and Texas are in the top 25 in this chart. I count Tennessee, Kentucky, Georgia, North and South Carolina, Florida and Mississippi as below average. Of course, this is unemployment we are talking about.
Query- I am also under the impression that a lot of people and business have moved South. How do you then explain the higher than average unemployment in those states? Why does Massachusetts usually have lower unemployment than Texas, except for that brief period from about 2004-2007? (Gratuitous dig.)
For fun, go to the Icepick link. Change the filters. Look at the average rather than the most recent filter.
Steve
One thing to remember: these are differences from average, not unemployment rates. And “more” means higher than average, “less” means lower than average.
One reason cold weather states might do better is this: If you’re unemployed, would you rather be in Florida/SoCal or Michigan/Ohio? People used to move here (Florida) because it was cheap and the weather was good, not because of the jobs. That would tend to drive down unemployment over time.
I look at Florida’s stats and I just see the ebb and flow of various real estate booms.
…
I’ve got a cat named Rorschach Gottlieb Sandelescu, so the spelling is no problem for me.
No matter how you play with the filters it looks like low-population, low density and/or cold-ass places outperform. It’s almost as if, hmmm, the “winners” are the places everyone has moved out of so there’s no one left to be unemployed.
So, Drew, there are your marching orders. As an investor you can’t afford to be blind to the obvious reality: Nebraska, baby! Nebraska.
Ice:
Cool shout-out to Jacques. Ever meet the guy face to face? He could scare you from a wheelchair. I’m morally certain that in his prime he could have killed me with his earlobe.
I did not. In fact I only met Annie in person around last Christmas. J’s pictures scare me, even without knowing what a bad-ass he was in real life. I too would fear the earlobe.
I met Annie a year or so ago, a few months after Jacques died. We got on immediately.
A contributory factor might be Medicaid. I don’t know the details and I’m disinclined to research them but it might be the case that Medicaid is more generous in the high increasing unemployment states than in the low increasing or decreasing unemployment states.
One example of that would be Louisiana. A significant number of poor people moved from the Northeast (New York, New Jersey, etc.) to New Orleans because they could receive more services from Medicaid in Louisiana than they could where they had previously lived. That’s one of the reasons there were so many poor, sick people in NOLA when Katrina struck.
Kaiser has a table of Medicaid income eligibility at the link. In general eligibility is at much lower income levels in Southern, warm states, which would mitigate against your idea. However, I have never seen a comprehensive look at what services are available once you are enrolled.
Steve
@Dave
You need to be careful using New Orleans pre-Katrina. The city dynamics was substantially different than the rest of the US, state, and Deep South. There is a heavy European influence, and I think it is probably the most European city in the US. You also have the issues of higher mid-size cities, and as a port city, those problems are also present.
Of the pre-Katrina population, 60-70% of the people were born in New Orleans, and it would be higher for the poorer areas. I find it highly unlikely that there was a large influx of poor folks to the city. I would guess any influx would be from higher income brackets. The film industry is one of the biggest in the US, and the tourist, casino, and convention industries also bring in outsiders.
For Louisiana, there is a heavy dependence on the oil industry, and this affects the unemployment numbers. These tend to be the newer arrivals, and they tend to be more mobile. Also, a new arrival is anybody without a native born second cousin, and permanent citizenship is awarded to those who have married a second cousin. When you are related to 90% of the people in you area, the number of second cousins is high.
I am not sure about the Medicaid numbers. In the city pre-Katrina, the poorer folks were served by Charity Hospital. It was a public/teaching hospital, and it had clinics for almost every area of healthcare. These are present in many large cities. The ER only treats actual emergencies, and any other traffic is routed to the clinic system. You are means tested, issued a Charity card, and billed as appropriate As with most things in NOLA, Charity is a cultural phenomenon, and people who have moved up the economic ladder will still use Charity.
steve,
Not surprising since wages and cost of living are generally lower in southern states. Wonder how it all works out once the various factors are included.