Edward Glaeser, economics professor at Harvard, points out that of the 65 US metropolitan areas with unemployment above 12%, 39 are in Michigan, Florida, or California.  Those three states may seem to have little in common, but, as Glaeser writes at the New York Times Economix Blog, their current economic struggle may be a "hangover of past success and a reflection of an abundance of people relative to economic activity."

The story of Michigan has been told frequently.  Big boom for the first half of the Twentieth Century with the rise of the auto industry.  Big decline later in the Twentieth Century as factories moved elsewhere, leaving large cities with fewer well paying jobs.  Glaeser:

California and Florida experienced bigger booms than Michigan ever did, but for different reasons.

Between 1940 and 1990, California’s population increased by 330 percent, while the United States population grew by less than 100 percent. Florida’s population was 4.95 million in 1940 and is expected to be 18.77 million in 2010, a 279 percent increase.

Some areas in California, like San Francisco, are among the most productive in the world, but other areas in both states are “consumer cities” that attract people primarily by providing a pleasant climate or a high quality of life. Florida also has some metropolitan areas that follow the recent Sun Belt pattern of attracting people by building abundant, inexpensive housing.

The consumer city works well if the area attracts well-educated, entrepreneurial people who make the local economy hum and protect it from extreme unemployment. But without those educated entrepreneurs, amenity-based places can end up with a lot of people relative to economic activity, just like the Rust Belt.

Read A Tale of Three States here.