Jobs return, but some states still struggling

Arizona second worst in nation

PHOENIX (AP) - A new report shows that Arizona ranks next-to-last in its recovery of jobs lost to the Great Recession.

The United States in May finally recovered all the jobs lost to the Great Recession. But 32 states still don't have as many jobs as they did when the recession officially began in December 2007.

Arizona has 5 percent fewer jobs than it did at the start of the recession. Only Nevada has a worse rate.

Professor Lee McPheters of the W.P. Carey School of Business says Arizona is regaining its jobs so slowly because its construction industry was hit hard by the recession. He expects construction to pick up as Arizona's population grows, helping the state regain its jobs in up to three years.

In May, the overall economy finally recovered all 9 million jobs that vanished in the worst downturn since the 1930s. Another month of solid hiring is expected in the U.S. jobs report for June that will be released today.

Even though economists declared the recession over in June 2009, Illinois is still down 184,000 jobs from pre-recession levels. New Jersey is down 147,000. Both states were hurt by layoffs at factories. Florida is down 170,000 in the aftermath of its real estate market collapse.

The sluggish job market could weigh on voters in some key states when they go to the polls this fall. A Quinnipiac University poll out Wednesday found that voters named the economy by far the biggest problem facing the United States.

The states where hiring lags the most tend to be those that were hit most painfully by the recession: They lost so many jobs that they've struggled to replace them all.

Nevada, which suffered a spectacular real estate bust and four years of double-digit unemployment, has fared worst. It has 6 percent fewer jobs than it did in December 2007. Arizona, also slammed by the housing collapse, is 5 percent short.

By contrast, an energy boom has lifted several states to the top of job creation rankings.

"North Dakota is the No. 1 example," says Dan White, senior economist at Moody's Analytics. "It's like its own little gold rush."

North Dakota has added 100,000 jobs since December 2007 - a stunning 28 percent increase, by far the nation's highest. The state has benefited from technology that allows energy companies to extract oil from shale.

Not surprisingly, the capital of North Dakota, Bismarck, has the lowest unemployment rate of any American city: 2.2 percent as of May.