Where unemployment is falling: a tale of six 'most improved' states

3. Alabama (unemployment down 1.2 percent)

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    Fishing boats are docked in Bayou LaBatre, Alabama's harbor on May 8.
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Like North Carolina, Alabama saw unemployment rise higher than the national average. Recent progress has brought the state's jobless rate down to 9.7 percent. Job gains have come across the board, from federal government to services like education and health care.

The South in general, including Alabama, has been gaining manufacturing jobs increasingly, in part because of a "right-to-work" tradition that puts the region in contrast with the Midwest and its labor-union traditions.

"There's been a clear shift from the Midwest towards the South," with automotive jobs being a lead example, says Mr. Vitner of Wells Fargo Securities. Although the Gulf oil spill has affected the state's coastal region, that's a relatively small part of Alabama's economy, he says.

Much of Alabama's improvement has occurred just in June and July. Since the Labor Department data often get revised for a month or two after the preliminary data come out, this is an example where it may be important to see to watch how those revised numbers turn out.

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