Earlier today I wrote about a Bureau of Economic Analysis report showing that the amount of unemployment benefits paid out in North Dakota had more than doubled in the last quarter.
Yet, even as that’s happening, the state hasn’t seen a spike in the unemployment rate. In fact, according to the September jobs report from North Dakota Job Service (see below), the unadjusted unemployment rate in August of 2015 was exactly the same as it was in August of 2014 (the seasonally adjusted rate was just 0.2 percent higher). The number of unemployed weren’t up all that much either:
So how can unemployment payments more than double even as the state’s unemployment rate stays relatively static? Well, that’s because most of the people collecting those unemployment benefits have moved back to the states they came from. Meaning that while the State of North Dakota is paying them their unemployment benefits, they count against their home state’s unemployment rate:
Michael Ziesch with Job Service North Dakota says about 53 percent of payments have gone to out-of-staters over the past twelve month period.
He says traditionally that number has been less than twenty percent.
In total $146 million in state payments went to those unemployed.
Of that figure $77 million went to non-residents.
“Although they are showing up in their home state unemployment rates, North Dakota is responsible for their benefits if they were laid off from a North Dakota employer,” says Ziesch.
This means that North Dakota’s unemployment rate isn’t going to be a very accurate measure of the state’s economic strength.