Washington : Unemployment increased in 27 states in February and dropped in seven, a sign the labour market needs to pick up across more regions to spur consumer spending and sustain the economic recovery.

Mississippi showed the biggest jump in joblessness with a 0.4 percentage point rise to 11.4 per cent, according to figures issued on Friday by the Labour Department in Washington. Nationally, unemployment held at 9.7 per cent in February for a second month and employers cut fewer jobs than anticipated, figures from the Labour Department showed on March 5.

Friday's report indicates broad-based hiring is yet to develop following the loss of 8.4 million jobs since the recession began in December 2007. Florida, Nevada, Georgia, and North Carolina set record levels of joblessness last month.

Worst over

"Until we see improvement in employment in a fair number of US states, it's not going to do a heck of a lot for the recovery," said Jennifer Lee, senior economist at BMO Capital Markets in Toronto. "The worst seems to be over, but there's a huge amount of work to be done to create jobs. It's going to be a long, winding road."

Payrolls dropped in 27 states, led by Virginia. The state's loss of 32,600 jobs last month, the largest in records going back to 1983, was also the biggest decline among states. California, Michigan, Pennsylvania, Maryland and Texas also reported large decreases in employment, the report said.

Michigan's jobless rate, while remaining the highest in the nation, fell for a second month. Unemployment there decreased to 14.1 per cent from 14.3 per cent in January.

Unemployment in the Detroit area, home to General Motors and Ford, fell to 14.8 per cent from 15.3 per cent.