LANSING, Mich. (AP) — Michigan's monthly unemployment rate has dropped for the first time in more than a year.

But good news is relative when it comes to the state's economy. The 15 percent seasonally adjusted jobless rate for July, announced by the state Wednesday, likely will remain the highest in the nation. Michigan's unemployment rate has been worst in the U.S. for 26 of the last 27 months.

Michigan's jobless rate in June was 15.2 percent, the highest monthly rate recorded in the state since early 1983. State officials said hiring in the hotel industry, nursing and residential care helped stabilize the rate last month.

Fewer Michigan autoworkers than usual were laid off in July for model changeovers in factories, but only because an abnormally high number were already out of work. That makes it difficult to read much into the fact that Michigan gained 18,000 manufacturing jobs in July in a seasonally adjusted count.

Rick Waclawek, director of Michigan's Bureau of Labor Market Information and Strategic Initiatives, said the rise in manufacturing jobs "does not reflect any real improvement in the job picture, but is just an artifact of the seasonal adjustment process."

Michigan has lost 119,000 manufacturing jobs in the past year. About 281,000 total nonfarm payroll jobs have been lost in the state overall in that time.

The state added 11,000 government jobs and 7,000 leisure and hospitality service jobs in July. Health education and business service jobs also increased.

Jobs were lost in retail trade and construction.

Michigan's monthly jobless rate hadn't dropped since June 2008. A year ago, it was 8.3 percent.

The national unemployment rate for July was 9.4 percent, down from the 9.5 percent registered in June. Unemployment has remained steady or dropped slightly in most of the states that have announced their rates for July so far.

Economists have projected Michigan's unemployment rate generally will rise in the second half of this year and into 2010, although there could be month-to-month variations. The University of Michigan estimated in July that state unemployment will average 15.8 percent next year.

But several wild cards could at least temporarily brighten that outlook, including the prospects for the auto industry. Some companies are boosting production for the rest of the year to keep up with increased demand sparked by the federal Cash for Clunkers program.

Michigan Gov. Jennifer Granholm said Wednesday that Congress should again extend jobless benefits for the nation's unemployed workers. An estimated 100,000 unemployed Michigan workers are expected to lose their jobless benefits by the end of the year.

Michigan residents are eligible for up to 79 weeks of jobless benefits, including 33 weeks of federal emergency unemployment compensation and 20 weeks of federally funded extended benefits.

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On the Net:

Michigan Department of Energy, Labor & Economic Growth: http://www.michigan.gov/dleg