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Unemployment Rate Trends of the Past 5 Years: Pre-, Mid-, and Post-Pandemic
April 01, 2024:In early 2020, the COVID-19 pandemic ended the United States’ decade-long era of economic expansion. Many businesses across industries halted or closed operations, resulting in record-high temporary and permanent job losses – events that have been reflected in unemployment rate trends.
Primarily, unemployment affects people’s economic stability and well-being, but it goes beyond that. Unemployment affects individuals’ access to stable housing, food security, and health insurance coverage and care. Unemployment has also been linked to negative health consequences, with unemployed individuals often reporting feelings of depression and anxiety, and suffering from stress-related illness such as high blood pressure, stroke, heart attack, heart disease, and arthritis more often compared to employed counterparts
Knowing that unemployment affects health and health care access, we wanted to understand how such a seismic event as the pandemic affected unemployment rates. We also wanted to determine what progress has been made in recovery post-pandemic. To do this, SHADAC used our State Health Compare tool’s unemployment measure, looking at data pre- (2018-2019), mid- (2020), and post-pandemic (2021-2022). Keep reading to learn more about our process and key findings.
Unemployment Rate Trends: Overall Rate Rose Sharply During Pandemic
Before the pandemic began, the United States was experiencing what the Bureau of Labor Statistics (BLS) called, “the second longest [period of] economic expansion on record,” with the unemployment rate reaching a 49-year low. Overall, the pre-pandemic national unemployment rates in 2018 and 2019 were 3.9% and 3.7%, respectively. In 2020, what we have termed as during / mid-pandemic, the unemployment rate rose sharply to 8.1%. As time went on, though, unemployment rates began to noticeably decrease, measuring at 5.3% in 2021 and dipping below 2019’s low to 3.6% in 2022.
It is no surprise that national unemployment was at its highest mid-pandemic in 2020 as a result of business closures (both temporary and permanent). However, some heartening news comes from the 2022 data showing a national unemployment rate sitting the lowest it had been in the past five years, and several other key labor market measures also returning to their pre-pandemic levels.
While encouraging, when looking at unemployment rates pre-, mid-, and post-pandemic, it is worthwhile to go beyond the seemingly straightforward, positive picture at the national level in order to understand how different geographic and demographic populations varied in unemployment rates. For our analysis, we looked at unemployment rate by state and by race/ethnicity.
Examining Unemployment Rate Trends by State
The following tables show the five states with the lowest and the highest unemployment rates each year from 2018 to 2022.
| Lowest | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| 2018 | 2019 | 2020 | 2021 | 2022 | |||||
| Hawaii | 2.4% | North Dakota | 2.4% | Nebraska | 4.2% | Nebraska | 2.5% | North Dakota | 2.1% |
| Iowa | 2.5% | Vermont | 2.4% | South Dakota | 4.6% | Utah | 2.7% | South Dakota | 2.1% |
| New Hampshire | 2.5% | New Hampshire | 2.5% | Utah | 4.7% | South Dakota | 3.1% | Nebraska | 2.3% |
| North Dakota | 2.6% | Utah | 2.6% | North Dakota | 5.1% | Kansas | 3.2% | Utah | 2.3% |
| Vermont | 2.7% | Hawaii | 2.7% | Iowa | 5.3% | Alabama | 3.4% | Missouri | 2.5% |
| Highest | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| 2018 | 2019 | 2020 | 2021 | 2022 | |||||
| Louisiana | 4.9% | New Mexico | 4.9% | Michigan | 9.9% | Dist. of Columbia | 6.6% | Pennsylvania | 4.4% |
| New Mexico | 4.9% | West Virginia | 4.9% | New York | 10.0% | New Mexico | 6.8% | Delaware | 4.5% |
| West Virginia | 5.3% | Mississippi | 5.4% | California | 10.1% | New York | 6.9% | Illinois | 4.6% |
| Dist. of Columbia | 5.6% | Dist. of Columbia | 5.5% | Hawaii | 11.6% | Nevada | 7.2% | Dist. of Columbia | 4.7% |
| Alaska | 6.6% | Alaska | 6.1% | Nevada | 12.8% | California | 7.3% | Nevada | 5.4% |
Certain unemployment rate trends have remained consistent in the last two years of the post-pandemic period, which could shed light on individual states’ economic recovery post-pandemic. For example, Nebraska and South Dakota have been among the five states with the lowest unemployment rates mid- & post-pandemic, suggesting less economic fallout from the pandemic. On the other hand, Nevada has ranked in the five states with the highest unemployment rates post-pandemic (2021 and 2022), suggesting perhaps a slower economic recovery due to COVID-19.
Case Study of Nevada: Misleading Overall Data
While a state’s overall unemployment rate may tell one story, a further breakdown into individual racial/ethnic subgroups may tell another, as we can see with Nevada.
Nevada’s total unemployment rate for 2021 was 7.2%, which was among the five states with the highest rate of unemployment for that year. However, the 2021 unemployment rate for White individuals in Nevada measured at 6.6% – lower than the overall state-level rate. In stark contrast, the 2021 unemployment rate for African American/Black individuals in Nevada measured at 15.3% – more than double the rates of White individuals in Nevada and the state’s overall unemployment rate.
Examining Unemployment Rate Trends by Race/Ethnicity
As observed in Nevada, a breakdown of unemployment rates by race/ethnicity gives insight to the disparities experienced by certain racial/ethnic subgroups. African American/Black, Hispanic, and Native American* individuals were more likely to suffer job loss compared to White workers during the pandemic. Adverse health outcomes and difficulty accessing healthcare are associated with longer periods of unemployment, which Black, Hispanic, and Native American workers endured more than White workers. Thus, it is important to consider the breakdown of race/ethnicity in relation to unemployment, especially when analyzing mid- and post-pandemic data.
While population-level unemployment rates may seem relatively low post-pandemic, a breakdown by race/ethnicity can reveal inequities and more detailed information regarding unemployment in the United States. The following chart shows the year-by-year total breakdown of unemployment by race/ethnicity, as well as the national rate for reference.
All four racial/ethnic groups follow the nationally observed unemployment trend: mid-pandemic (2020) rates are the highest, and, by 2022, unemployment had returned to pre-pandemic (2018 and 2019) levels.
However, deeper analyses of these five-year trends reveal disparities for certain racial/ethnic subgroups. For example, White individuals are the only racial/ethnic group to have their lowest national unemployment rate in the last five years be post-pandemic (3.2% in 2022). Compare that to African American/Black adults and Hispanic/Latino adults who, in the same year of 2022, have had higher unemployment rates (6.1% and 4.3%, respectively) than the national U.S. rate (3.6%). White and Asian adults have had lower unemployment than the U.S. rate for the last five years, except in 2020 where the unemployment rate for Asian adults was 8.7% compared to the U.S. rate of 8.1%.
Conclusion
Due to the implications that unemployment has on health and health care, it is important to consider the disparities in rates among different racial/ethnic groups. Even in states where unemployment may seem to be trending down, this rate could be misleading when not accounting for race/ethnicity.
Overall, national unemployment has returned to pre-pandemic rates, and the same trend has been observed across racial/ethnic groups. However, unemployment rates for African American/Black and Hispanic/Latino individuals are still consistently higher than the U.S. rate, revealing the need for targeted attention toward addressing unemployment rates for these populations.
To learn more about this and other related subjects, check out the following products on our site:
- Six Measures on SHADAC’s State Health Compare Now Updated to Include Pandemic-era Data for Health Behaviors and Outcomes
- Revised Childhood Vaccinations Measure on State Health Compare Shows Vaccination Rates Vary by State, Race/Ethnicity, and Insurance Coverage
- The Opioid Crisis in the Pandemic Era
You can also explore these and many other data measures with our State Health Compare tool here.
*State Health Compare does not currently have available data for Native American individuals, due to low response rate. However, SHADAC is hopeful this data gap will be addressed in the future in order to conduct equitable analyses.
