September state jobs data shows how uneven the industrial labour market has become

The US Bureau of Labor Statistics released its state employment and unemployment figures for September on Tuesday 20 October. The national unemployment rate held at 4.2%, essentially flat on both the month and the year, but the state-level detail shows a much less even market underneath.

Where labour is tightest and loosest

South Dakota had the lowest jobless rate in the country at 2.0%, with North Dakota close behind at 2.2%. At the other end, California (5.1%) and Michigan (5.0%) had the highest rates of any state. The District of Columbia was higher still at 5.6%, though it isn't a state.

Rates came down over the month in Maryland and New Hampshire (both by 0.2 points), and in Florida, Nevada and Pennsylvania (each by 0.1 points).

Payroll moves

Only a handful of states saw payroll changes large enough to count as statistically significant in September. New Jersey added 14,900 jobs and South Carolina added 12,500. Wisconsin, a major manufacturing state, lost 13,700.

Over the year, Texas added the most jobs (154,300), followed by California (129,300) and North Carolina (67,000). The District of Columbia was the only area to lose jobs year on year, down 25,800.

Manufacturing detail

The release's industry tables show how factory employment is shifting state by state. California, the largest manufacturing employer, had 1,199,800 manufacturing jobs in September, down from 1,210,500 a year earlier. Connecticut went the other way, rising from 152,100 to 157,700 over the same period.

The bigger picture

Skills, not just headcount, remain the sticking point for manufacturers. In the Manufacturing Institute's State of Workforce Training in Manufacturing report, published in April, manufacturers were estimated to spend $31.9 billion a year on training, with new employees getting an average of 47.6 hours. In the National Association of Manufacturers' Q1 2026 outlook survey, 44.7% of respondents cited talent concerns.

Taken together, the data suggests a national rate that hides very different local conditions. An employer recruiting a maintenance lead in the Dakotas is competing in one of the tightest labour markets in the country, while the same search in Michigan or California may draw a larger pool, even if the skills match is still hard to find.