Nevada still has the highest unemployment in the US, even as overall market improves

New York(CNN Business) America witnessed record jobs growth in May as the country is attempting to rebound from the pandemic recession. But job gains haven't been spread evenly across the country.

The US unemployment rate declined to 13.3% in May, after hitting a record high of 14.7% in April. And while that is a good sign overall, things are still dire in states reliant on the industries the Covid-19 pandemic has hurt the most, including hospitality and tourism.

Nevada is big in both of those industries, and it still has the highest unemployment rate in the nation, even though it fell to a seasonally adjusted 25.3% in May from 30.1% in April, the Bureau of Labor Statistics said Friday.

Nebraska is leading the country with the lowest May unemployment rate, at 5.2%.

Tourism-reliant Hawaii and Michigan have the second and third highest unemployment rates in the country at 22.6% and 21.1%, respectively. In both states, the jobless rates declined some in May.

Hawaii, along with the District of Columbia, was also the only state that recorded further job losses in May.

It's hard to see when things will improve for the tourism-dependent Hawaii, which has implemented a mandatory 14-day quarantine for all arriving travelers. That makes a trip much less appealing.

Meanwhile, Covid-19 infection rates are increasing in pockets around the country.

"As such, dependence on tourism may be a more important driver for joblessness in this rebound period than the time of re-openings," said Mike Englund, chief economist at Action Economics, in emailed comments.

Economists hoping for a clear link between an earlier reopening of states and a lower unemployment rate didn't get that clarity. The connection held in only a handful of states, like Georgia, where the jobless rate dropped to 9.7% from 12.6% in April.

Still, on the whole, unemployment rates declined in most states -- only Minnesota, Connecticut and Florida registered small increases -- and that's undeniably a positive.

Florida actually also recorded one of the biggest increases in new jobs. While that might seem contradictory, the size of Florida's labor force simply increased in May.

In total, 46 states added new jobs, with Texas and Pennsylvania topping that list.

Long road to recovery

Even though the labor market is showing sure signs of improvement, it is clear that this crisis is far from over.

More than 20 million US jobs vanished in April as the country went on lockdown to prevent the spread of Covid-19, and the unemployment rate rose to an all-time high in 43 states in response.

It will be a long road to recovery from this shock.

Millions are still reliant on unemployment benefits to make ends meet. Washington's CARES Act increased jobless aid by $600 per week and made benefits available to groups that would not usually get them, including the self-employed.

But that lifeline of additional weekly cash is slated to roll off at the end of July. Many economists are now calling for Congress to act and extend the benefits.

The issue is complex: On the one hand, the US economy needs consumers to spend money to grow. With less cash in the country's wallets, the recovery could be held back.

At the same time, however, there are concerns that larger than usual unemployment benefits will keep people from returning to work.

The government has to find a way to strike a balance. But given how high unemployment remains across the country, it is unlikely that enhanced benefit will just lapse entirely, Andrew Hunter, senior US economist at Capital Economics, said in a note.

Earlier this week, more than 100 economists, including former Federal Reserve Chairwoman Janet Yellen and Chairman Ben Bernanke, urged the government to deploy more stimulus.