E. Unemployment Rate

From 1978 through 2000, RTW states had lower average annual unemployment rates for all but 5 of 23 years. Right-to-work states also weathered the 1990-91 recession better, with unemployment rising only 0.43 percent (from 1990-91) compared to a 1.13 percent rise for non-RTW states.

The unemployment gap between RTW and non-RTW states dissipated during the 1990s, reflecting a national trend toward tighter labor markets (and full employment) in most states. This phenomenon produced labor shortages which were more acute in RTW states.

Michigan's unemployment rate averaged 8.1 percent from 1970-2000, significantly higher than the 5.8 and 6.3 percent average for RTW and non-RTW states, respectively. While Michigan's average rate did fall below the national average during much of the 1990s, this was more a consequence of slower growth in Michigan's workforce (i.e., fewer eligible workers), not faster employment growth.  See Chart 8.