In December 2015 Ames Iowa had the lowest unemployment in th

In December 2015, Ames, Iowa, had the lowest unemployment in the United States at 2.2 percent of the workforce. At the other end of the scale was El Centro, California, with 19.6 percent of its workforce unemployed. In the depth of the 2008–2009 recession, the unemployment rate in Ames peaked at 5.7 percent. In El Centro, it peaked at 30.3 percent.

How would you explain the difference in the unemployment rates in Ames and El Centro in December 2015? Why is the difference almost certainly not explained by different cyclical unemployment rates?

Solution

Cause of low unemployment rate in Ames:

Causes of high unemployment: