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State unemployment rate clicks down to 3.1%, lowest level since 2019

Over-the-month jobs volatility continues, Minnesota posts strong over-the-year growth

St. Paul - The state unemployment rate moved down two-tenths of a percentage point to 3.1%, due to people moving from unemployment to employment, according to numbers released today by the Minnesota Department of Employment and Economic Development (DEED). Minnesota’s labor force participation rate remains steady at 67.7%. The U.S. unemployment rate fell three-tenths of a percentage point to 3.9% and the national labor force participation rate held steady at 61.9% (revised).

In December, Minnesota lost 2,000 jobs, down 0.1% on a seasonally adjusted basis. The private sector lost 2,200 jobs, down 0.1%. However, this decline is coupled with a large upward revision of the November employment numbers, which were revised upward by 5,000 jobs in total nonfarm unemployment and upward by 4,600 in the private sector. Those upward revisions are on top of the strong growth of 8,600 jobs reported in November, when the private sector gained 10,200 jobs.

“Today’s jobs report is a reminder that economic progress in these times is not a straight line,” said DEED Commissioner Steve Grove. “The good news remains that our economy is bursting with great job opportunities, and DEED will continue our proactive programs to Minnesota job-seekers across the state.”

Job growth has been uneven coming out of the pandemic recession. Translating seasonally adjusted job change into a 3-month moving average series, Minnesota added 9,100, up 0.3% in August-October; 12,300, up 0.4% in September-November; and 7,200, up 0.2% in October-December. Nationally, all three periods have shown a 0.3% increase. The U.S. gained 199,000 jobs, up 0.1% in December, with the private sector adding 211,000 jobs, up 0.2%.

Over the month of December in Minnesota, five supersectors lost jobs, five gained jobs, and Mining & Logging remained level with November on a seasonally adjusted basis.

• Losses were in Financial Activities down 900; Professional & Business Services down 1,800; Manufacturing, down 900; Trade, Transportation & Utilities down 800; and Leisure & Hospitality down 600 jobs.

• Gains were in Information, up 300; Other Services, up 400; Education & Health Services up 1,800; Government up 200; and Construction up 300 jobs.

Minnesota gained 168,247 payroll jobs, up 6.2%, over the year. The private sector gained 163,477 jobs, up 7.1% over the year. These gains put total nonfarm employment 109,100 jobs short of December 2019 employment and 89,300 jobs short in the private sector. U.S. employment grew 4.6% over the year with the private sector up 5.1% in December. For the third time this year, Minnesota’s private sector over-the-year job growth exceeded the nation. Five supersectors in Minnesota showed strength over the year compared to the U.S.: Leisure & Hospitality, Construction, Professional & Business Services, Manufacturing, and Other Services.

Minnesota lost 416,300 jobs from February through April 2020, and has since gained 307,400 jobs, or 74% of the jobs lost on a seasonally adjusted basis. The private sector has regained 77% of the jobs lost.

Many Minnesotans continue to be out of work, but the employment impact of the pandemic on workers has been difficult to measure. The pandemic caused some people to drop out of the workforce, lowering labor force participation, which resulted in an unemployment rate below what would be expected given job losses. The table below accounts for this by showing an adjusted unemployment rate, based on 12-month moving averages, that includes both Minnesotans who are looking for work now and who would have been expected to be working or looking for work if it wasn’t for the impact of the pandemic.

Adjusted Unemployment Rate, based on 12-month moving averages – December 2021

Month/Year Total Black Hispanic White

Dec-21 6.2% 11.1% 2.7% 5.4%

Nov-21 6.3% 10.0% 2.8% 5.6%

Dec-20 6.7% 15.7% 7.4% 6.0%

Minnesota and U.S. Employment and Unemployment – December 2021

Seasonally Adjusted Not Seasonally Adjusted

Unemployment Rate Dec. 2021 Nov. 2021 Dec. 2021 Dec. 2020

Minnesota 3.1% 3.3% 2.7% 4.9%

U.S. 3.9% 4.2% 3.7% 6.5%

Non-Farm Jobs Dec. 2021 Nov. 2021 Dec. '20- Dec. '21 Level Change Dec. '20- Dec.'21 % Change

Minnesota 2,887,400 2,889,400 168,247 6.2%

U.S. 148,951,000 148,752,000 6,568,000 4.6%

Minnesota and U.S. Over-the-Year (OTY) Employment Change, Not Seasonally Adjusted: December 2020-December 2021

Industry Supersector OTY Job Change OTY Growth Rate (%) U.S. OTY Growth Rate (%)

Total 168,247 6.2 4.6

Private 163,477 7.1 5.1

Mining & Logging -28 -0.5 8.8

Construction 8,894 7.7 2.1

Manufacturing 14,025 4.6 2.9

Trade, Transport. & Utilities 12,861 2.5 3.1

Information 207 0.5 5.4

Financial Activities -4,890 -2.5 1.8

Prof. & Business Services 20,739 5.8 4.9

Ed. & Health Services 6,055 1.1 2.4

Leisure & Hospitality 95,072 64.2 19.6

Other Services 10,542 10.9 6.4

Government 4,770 1.2 1.9

Metropolitan Statistical Area (MSA) Over-the-Year (OTY) Employment Change, Not Seasonally Adjusted: December 2020-December 2021

Metropolitan Statistical Area OTY Employment Change OTY Employment Change (%)

Minneapolis-St. Paul MN-WI MSA 98,820 5.3

Duluth-Superior MN-WI MSA 6,165 4.9

Rochester MSA 6,520 5.6

St. Cloud MSA 4,958 4.8

Mankato MSA 2,429 4.5

Visit the DEED website to see DEED’s alternative measures of unemployment. You can also find monthly jobs numbers and unemployment data on DEED’s website. Access resources to help Minnesotans prepare for and find employment now at CareerForceMN.com/GoodJobsNow.

Press interested in attending the virtual press conference on January 20 at 10:30am should RSVP to alicia.cordes-mayo@state.mn.us before the press conference.

DEED is the state’s principal economic development agency, promoting business recruitment, expansion and retention, workforce development, international trade and community development. For more details about the agency and its services, visit the DEED website, the JoinUsMn.com website, or follow us on Twitter.

 

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