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Jobless: 4 states above 10%

The state-by-state readings come just days after the government reported nationwide unemployment of 8.1%.

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By Julianne Pepitone, CNNMoney.com contributing writer

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NEW YORK (CNNMoney.com) -- As unemployment soared in January, four states' jobless rates climbed higher than 10%, according to federal data released Wednesday.

In January, 49 states and the District of Columbia recorded month-over-month unemployment rate increases, the Labor Department reported. All 50 states and the District of Columbia had higher rates than the previous year.

Nonfarm job totals fell in 42 states, increased in 7 states and the District of Columbia, and were unchanged in Vermont.

Only Louisiana's jobless rate decreased. It fell to 5.1%, 0.4 percentage point lower than the previous month.

The report also included information for Puerto Rico. The U.S. commonwealth's jobless rate fell 0.5 percentage point from last month, but still stands at a whopping 13%.

The state-by-state unemployment report for January came after the government reported Friday that employers slashed 651,000 jobs across the nation in February and a revised 655,000 jobs in January.

That brought job losses over the last six months to more than 3.3 million. The nation's unemployment rate in February stood at 8.1%, its highest level in 25 years and up from 7.6% in January.

Wednesday's report shows jobless rates in several states soared in January, with four surging through the double-digit percentage level. Michigan, South Carolina, Rhode Island and California led U.S. jobless rates.

Leading states: The jobless rate in Michigan led the pack, soaring 1.4 percentage points to 11.6%. The state lost 69,000 jobs.

The auto industry downturn has hammered Detroit - the state's manufacturing sector accounted for 53,000 of these jobs lost.

Michigan's current unemployment rate is the highest since May 1984, during another rough time for automakers, said Rick Waclawek, a director at the state's labor department.

The state with the second-highest rate was South Carolina, where the jobless rate jumped 1.6 percentage points to 10.4%. South Carolina tied with North Carolina and Oregon for the largest month-over-month rate increase.

South Carolina also tied with North Carolina for the largest jobless rate increases from the previous year, at 4.7 percentage points.

The state with the third-highest unemployment rate, Rhode Island, capped a full year of consecutive job losses for the state. Its unemployment rate climbed 0.9 percentage point to 10.3%.

The unemployment rate in California, the nation's most populous state, was the fourth highest. It climbed 1.4 percentage points to 10.1%.

Lowest rates: Wyoming had the lowest unemployment rate, at 3.7%. That's a 0.5 percentage point increase from December.

North Dakota's jobless rate was second lowest. It climbed 0.9 percentage point to 4.2%.

State budget issues: The job losses have weighed on state budgets. When people lose their jobs, they pay less in personal state income tax, they spend less money, and rely more on public-funded programs.

It's a bitter cocktail for the states. At least 46 of them face shortfalls this year or next, according to Nick Johnson, director of the state fiscal project at the Center on Budget and Policy Priorities.

States are leaning on the $140 billion included for them in President Obama's $787 billion package, which is meant to stimulate the economy and promote job growth.

But that's only about 40% of states' combined budget gaps for the remainder of the current fiscal year and the next two years, Johnson said.

Chad Stone, chief economist, said the Center is "pretty confident" the stimulus package will start to have an impact over 2009.

"Given the momentum of the downturn, this money will merely slow the decline rather than turn it around," Stone said. "It's going to be hard to see the effect even if it's working well." To top of page

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