Job growth showed continued strength across much of the USA in June, but there was weakness in employment in two states that polls show could go either way in the presidential race.
Michigan and Ohio lost factory jobs last month, according to figures released Tuesday by the Labor Department.
Overall, preliminary job figures for June were mostly good news for Bush. They showed continuing growth in most states. Employment was up from May in all but 10 states and above year-ago levels in all but four. Unemployment, which is at 5.6% nationally, was below year-ago levels in all but three.
Most of the 17 states in the presidential election that could tip either way and decide the race gained jobs. Swing states Missouri, Wisconsin, West Virginia, Oregon and Pennsylvania were among the 11 fastest-growing job markets.
But Ohio, which in 2000 Bush won by 3 percentage points, and Michigan, which he lost by 5 percentage points, remained exceptions. The number of jobs in Ohio shrank for the eighth time in 10 months and for the sixth time in Michigan in 10 months. The nation overall saw 112,000 new jobs.
Job losses in Michigan and Ohio were concentrated in manufacturing. Ohio lost 3,400 factory jobs in June — its worst month in nearly a year and the tenth loss in 12 months. Michigan lost nearly 10,000 factory jobs — its sixth month of factory job losses in ten months and the highest in nearly three years.
Factory job losses in June extended what is already the longest restructuring of those two states' economies since the 1980s. More than a fifth of each state's factory-job base has evaporated since 1999. Many economists believe the national economic recovery is secure and the recent slowdown in economic growth temporary, but many also see no immediate end for Michigan and Ohio's troubles.
"You still have a structural adjustment going on in these states, and it looks like it's not over yet," says Philip Hopkins, an expert on regional economies at Global Insight, a consulting firm. "Factories are still shedding labor to remain competitive, and they're moving away from high-cost states."
Steve Cochrane, who studies state economies for the consulting firm Economy.com, said the losses in Michigan and Ohio were overwhelmingly in the auto industry.
"It's pretty tough to be competitive when you're dealing with the high pay packages autoworkers get in these two states," he said.
Sen. John Kerry's campaign has shifted its economic criticism of Bush from complaints about a job shortage to criticism about the quality of jobs being created. In Michigan, the loss of factory jobs in June and over the past year has been mirrored by a surge in lower-paying leisure and hospitality jobs.
The Bush campaign focused on the national jobs picture and noted that Michigan and Ohio have suffered a drop in auto sales since buyer incentives were scaled back.
"June was a tough month for the auto industry," said Tim Adams, policy director for the campaign. "But those are long-term structural problems, they're sector-specific and they may be an aberration. ... The broader national trends are solid and this recovery is sustainable."
"The jobs we've lost are not being replaced by jobs of the same caliber," Kerry campaign spokeswoman Alison Dobson said.
Nationally, that picture is unclear. One government report shows job growth being led by industries where average pay is below the national average, but another shows it is led by occupations in which pay is above the national average.
Randy Ilg, an economist with the Bureau of Labor Statistics, which produces both reports, said the pattern is inconclusive. "We don't have the data we need on what jobs new hires are getting and where they're ending up on the pay scale to answer the question" of whether the recovery is being led by high- or low-wage jobs.
Ilg said both sides of the debate are torturing the data and "making mountains out of molehills."
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