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Unemployment Is Falling Everywhere Except the Northeast. Why Is That?

Washington Post (10/20/12) Bradford Plumer

According to the latest data from the U.S. Bureau of Labor Statistics, unemployment is falling in 41 states—but unemployment in the Northeast U.S. appears to have been getting significantly worse over the past year. The Northeast unemployment rate has risen from 7.9% in April to 8.5% this past September:

Among the theories as to why this is occurring is that the Northeast has been hit harder by the slowdown and debt crisis in Europe than anywhere else. The Northeastern U.S. exports more to Europe than any other region. Manufacturing has shrunk more rapidly in the region than anywhere else in the country this year. And the already-shrinking financial sector in New York and Connecticut has been battered by the euro zone’s debt crisis.

Meanwhile, the South has benefited greatly from oil and gas production. The West is buoyed by growth in technology firms, and the Midwest has the most diversified export markets. The housing market has been slower to recover in the Northeast than in the rest of the country, based on the latest data on home sales and prices. Also, states like New Jersey, Pennsylvania, and Connecticut are all seeing a sharp cutback in public sector employment.