This article will look at the 20 states with the highest unemployment rates. We have also discussed important statistics related to employment in the US. If you want to skip our detailed analysis, head straight to the 5 States with the Highest Unemployment Rates. 

In September 2023, the US Bureau of Labor Statistics reported that total nonfarm payroll employment increased by 336,000 and surpassed the average monthly increase of 267,000 over the previous year. Within the private sector, 263,000 jobs were added, while government employment saw an increase of 73,000 jobs. 

The leisure and hospitality sector added 96,000 jobs, while the food services and drinking places sub-sector alone contributed 61,000 jobs. Private education and health services added 70,000 jobs, primarily in healthcare and social assistance. Professional and business services also reported an increase of 21,000 jobs, with contributions from professional, scientific, and technical services. Most other major industries experienced little change in employment. Average hourly earnings for private nonfarm payroll employees increased by 7 cents, or 0.2%, reaching $33.88 in September. Over the past year, average hourly earnings grew by 4.2%.

According to a recent analysis by Axios, Las Vegas, Chicago, Los Angeles, and Houston are the metropolitan areas that have the highest unemployment rates in the US. On the other hand, Miami, Minneapolis and Tampa Bay have the lowest unemployment rates. In 2023, The national unemployment rate in the US stands at 3.8%. It is worth highlighting that as of August 2023, Maryland is the state with the lowest unemployment rate. To read about unemployment worldwide, check our article about the countries with the lowest unemployment rates. 

Before we get into our list of the states with the highest unemployment rates in the US, it is important to discuss which industries are most in demand employment-wise to get a better understanding of the bigger picture. One of the most in-demand jobs for the future is that of solar photovoltaic installers owing to the growth in the solar energy market. 

In fact, the solar energy job market in the United States has experienced a huge growth as the number of jobs increased by 9% in 2021 with more than 255,000 positions. The sector did see a temporary contraction in 2020 due to the pandemic. Over the past decade, the solar industry has more than doubled its workforce, emphasizing its status as one of the fastest-growing industries of the US energy sector, largely driven by growing demand for clean energy to combat climate change.

Most solar jobs are in installation and project development, making up nearly 77% of the industry’s workforce. This growth is attributed to the rising demand for clean power from both government initiatives and businesses. While the solar industry touts itself as a job engine, it has also urged Congress to extend tax credits to keep solar energy competitive with traditional fossil-fuel power plants. California is the leading solar market in the US, with nearly 30% of the industry’s jobs, followed by states like Florida, Massachusetts, New York, and Texas. However, there are challenges like supply chain disruptions and a need for a more inclusive workforce, as women make up less than 30% of solar employees, and black workers represent 8% of the industry, compared to 12% in the national workforce.

In line with these needs and challenges, SunPower Corp (NASDAQ:SPWR), one of the biggest residential solar technology and energy services providers, announced their three grant programs aimed at promoting clean energy accessibility and equity across the United States. These initiatives are essentially funded by the SunPower Foundation which is the philanthropic branch of Sunpower Corp (NASDAQ:SPWR).

They include a Workforce Development Grant to improve solar workforce diversity, a Minority and Women Owned Business Enterprise (MWBE) Grant to support minority and female entrepreneurs in the solar industry, and a Solar Accessibility, Affordability, and Resiliency Grant to help historically underserved communities adopt solar solutions.

Qualified nonprofit organizations can apply for grants ranging from $5,000 to $100,000, with the application window open until October 20, 2023, and recipients to be announced by year-end. SunPower Foundation has also previously awarded over $1 million in grants to organizations such as GRID Alternatives and Habitat for Humanity of Greater Sacramento to expand solar access.

Moreover, SunPower Corp (NASDAQ:SPWR) also announced its support for Habitat for Humanity of Greater Sacramento’s Cornerstone affordable housing community by enabling it to operate on renewable energy. SunPower donated 140 high-quality solar panels and provided a grant to help create the first-of-its-kind, all-electric, solar-powered housing community in Sacramento.

This initiative, in partnership with Mutual Housing of CA, is set to benefit low-income families and is expected to save each homeowner approximately $1,500 annually. SunPower Corp (NASDAQ:SPRW)’s employees volunteered on Earth Day to assist with the installation and renovation of homes in the Cornerstone community, aligning with their commitment to expand solar access to disadvantaged communities under the 25×25 diversity, equity, and inclusion (DE&I) initiative. 

On the other hand, Walmart Inc (NYSE:WMT), the largest private employer in the US with 1.6 million associates has raised wages for its store associates and created tech-focused positions in an effort to enhance the quality of their work lives. The hourly wage for Walmart Inc (NYSE:WMT) workers has been increased from $12.00 to $18.00 to $14.00 to $19.00 after March 2023. Despite anticipated layoffs due to slower business conditions and rising inflation, Walmart Inc (NYSE:WMT)’s decision to provide raises is a testament to the impact of inflation on its workforce since the pandemic began. 

On the financial end, in the Q2 FY24, Walmart Inc (NYSE:WMT) reported consolidated revenue of $161.6 billion which was a 5.7% increase compared Q2 2023. When adjusted for constant currency, the revenue increased by 5.4%.

Methodology

To list the states with the highest unemployment rates, we utilized the unemployment rates provided by the Bureau of Labor Statistics, ensuring that the list is based on reliable and objective statistics. The unemployment rates were acquired from BLS data for the most recent month, i.e., August 2023, for all 20 countries.

In the case of identical unemployment rates, the state with a higher population was ranked higher. 

20. Oregon 

Unemployment Rate: 3.4%

Oregon’s unemployment rate reached 3.4% in August, although down from 3.5% in June, according to the Oregon Employment Department. This marked the seventh consecutive monthly decrease, and it equaled the previous record low of 3.4% from November and December 2019. The largest employer in the state is Providence Health & Services. 

19. Indiana 

Unemployment Rate: 3.4%

Unemployment claims in Indiana have increased, with 3,276 initial filings in the week ending October 7, up from 2,763 the previous week, according to the US Department of Labor. Walmart Inc (NYSE:WMT) and Eli Lilly and Co (NYSE:LLY) are amongst the largest employers in Indiana. 

18. Ohio 

Unemployment Rate: 3.4%

On October 12, 2023, the Ohio Department of Job and Family Services reported a decline in weekly unemployment claims in Ohio. Initial traditional unemployment claims were 6,084, 864 fewer than the previous week, while continued claims for October 1-7 were 35,337, an increase of 218 from the previous week. The largest employers in Ohio are Walmart Inc (NYSE:WMT) and Amazon.com, Inc (NASDAQ:AMZN). 

17. Pennsylvania

Unemployment Rate: 3.5%

Pennsylvania’s unemployment rate in August 2023 remained at 3.5%. Small business owners in the state continue to benefit from this low rate, and the total number of nonfarm jobs has increased. 

16. West Virginia 

Unemployment Rate: 3.6%

In August, West Virginia’s seasonally adjusted unemployment rate increased by two-tenths of a percentage point to 3.6%, with the number of unemployed residents rising by 1,800 to 28,300. West Virginia is one of the states with the highest unemployment rates.  

15. Connecticut 

Unemployment Rate: 3.6%

Despite an unemployment rate of 3.6% in Connecticut, the state still has around 90,000 unfilled jobs across different industries. The government is actively attracting workers through education and job training programs. The increase in employment is expected to boost state revenue and address pension fund underfunding. Electric Boat, a major employer and a subsidiary of General Dynamics Co (NYSE:GD), is hiring over 5,700 workers to meet production demands. 

14. Washington 

Unemployment Rate: 3.6%

Washington state’s unemployment system is still grappling with pandemic-related issues, including fraud and overpayments. While investigators have recovered two-thirds of the $647 million in stolen pandemic benefits, $223 million may never be retrieved.

13. New Mexico

Unemployment Rate: 3.7%

New Mexico’s unemployment rate has largely improved since the pandemic but still remains relatively high compared to the national average. In August 2023, the state’s seasonally adjusted unemployment rate was 3.7%. Over the past year, New Mexico added approximately 16,600 nonfarm jobs. 

12. Michigan

Unemployment Rate: 3.7%

In August, Michigan’s unemployment rate increased slightly to 3.7%, but the number of employed people also grew. General Motors Co (NYSE:GM) is the largest employer in Michigan. 

11. Arizona

Unemployment Rate: 3.8%

Arizona has seen a rise in unemployment as 38,865 Arizonans have filed for unemployment insurance, a 30.5% increase year on year. Simultaneously, the “hires rate” and the number of job openings have decreased. 

10. Alaska

Unemployment Rate: 3.9%

In August, the unemployment rate in Alaska increased slightly to 3.9%, up from 3.8% in July, as the seasonal number of jobs in the state decreased. Despite the small increase, Alaska’s unemployment rate has remained below 4% since the beginning of 2022, and the state has seen a 1.4% increase in total jobs year over year. It is one the states with the worst unemployment rates. 

9. New York

Unemployment Rate: 3.9%

In August, local unemployment rates increased in parts of New York, with Allegany County reporting an unemployment rate of 4.1%, up from July’s 3.7%. Meanwhile, the state’s unemployment rate remained steady at 3.9%.  New York is one of the states with the highest unemployment rates. 

8. Kentucky

Unemployment Rate: 4.0%

In Kentucky, initial filings for unemployment benefits increased to 1,478 in the week ending October 7, up from 1,403 the previous week, according to the US Department of Labor. It is one of the top 10 states with the highest unemployment rates. Kentucky is also one of the most illiterate states of America. 

7. Delaware 

Unemployment Rate: 4.1%

In August, Delaware’s unemployment rate remained steady at 4.1%, the same as in July, but slightly higher than the national rate of 3.8%. However, it is an improvement from August 2022 when the state’s unemployment rate was 4.5%. Area unemployment rates, except for Newark, increased slightly from July. Job numbers in the state declined in August, with considerable drops in the Trade, Transportation, Utilities, and Private Education and Health sectors. On a positive note, construction jobs increased over the previous month. Over the past year, Delaware has added a total of 9,800 jobs.

6. Illinois 

Unemployment Rate: 4.1%

According to the US Department of Labor, unemployment claims in Illinois increased last week as initial filings increased to 9,274 from 7,370 the week prior. Illinois is also one of the least tax-friendly states for middle-class families. 

Click here to see the 5 States with the Highest Unemployment Rates.

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Disclosure: None. 20 States with the Highest Unemployment Rates is originally published on Insider Monkey.