It’s well known that the longer you have been without work, the harder it is to find it. But just how many separate factors conspire to create the cycle of unemployment is still under-appreciated. A lot of attention has been paid recently to how employers don’t want to take a chance on the jobless. On top of that you can add that folks without a job are more likely to live in places where the economy is weak, and have less money to look for work, or to move to where there is work.
Bloomberg’s Steve Matthews and Victoria Stilwell wrote about how America’s young adults, already hit with weak job prospects, are staying home to save money. You can see a similar disheartening pattern at work when you start tracking the regions American leave.
The chart below illustrates unemployment and mobility in the United States, using data from the Census Bureau’s American Community Survey. The left axis is the unemployment rate for each state; the bottom axis is the percentage of residents who moved out of state last year. I’ve left off Washington, DC and Alaska because the very high rates of migration out there would leave the rest of the states clustered at the left of the chart.
You might expect that folks would be more likely to leave states with high unemployment. In fact, the opposite is the case. California, with an unemployment rate of 8.1 percent, has one of the lowest rates of outward mobility (1.5 percent); the same goes for Michigan, with an unemployment rate of 7.5 percent. In general, as the trend line shows, people are less likely to to move as the unemployment rate rises. If you want to see the precise data for each state in this Google Docs spreadsheet.
Numbers for large states like California probably skew downwards because folks are more likely to move within the state. But basically what seems to be happening is that people are staying put in places where there are few jobs because they don’t have the resources to move. Research from the St. Louis Fed had also found that those who lose their jobs become far less likely to relocate.
The real-world mobility-killing effects of unemployment are probably stronger than you would guess from this chart alone. States with a better employment picture have higher rates of mobility both in and out; overall there’s a slight gain in population for those states. The likelihood is that many of the people who do make the jump have better prospects to start — people with jobs moving to better ones. Unfortunately, there’s no obvious solution to this kind of vicious cycle. If the unemployed can’t move to where the jobs are, you need to bring the jobs to them. But so far, despite a whole lot of effort, no one has figured out how to make Michigan, Mississippi or Connecticut as attractive as Silicon Valley.
Correction: This post originally misspelled Victoria Stilwell‘s name, particularly embarrassing in a post that builds on her excellent story.