Minnesota Posts Robust January Job Growth Signaling a Strong Start to 2023
Labor force participation and unemployment rates both up after annual revisions
March 10, 2023
St. Paul - Minnesota gained 14,100 jobs over the month in January, up 0.5%, on a seasonally adjusted basis, according to numbers released today by the Minnesota Department of Employment and Economic Development (DEED). The state’s private sector gained 12,000 jobs, also up 0.5%. From December to January, Minnesota’s unemployment rate stayed at 2.9% and the labor force participation rate remained at 68.1%, after revisions that are made every year at this time.
Nationally, over the month, the unemployment rate fell one-tenth of a percentage point to 3.4% and the labor force participation rate ticked up to 62.4% (revised). U.S. total nonfarm employment increased by 517,000 jobs, or 0.3% from December to January.
“Our tight labor market continues to provide great opportunities for job seekers and challenges for many employers,” said interim DEED Commissioner Kevin McKinnon. “DEED will continue outreach to Minnesotans who remain on the employment sidelines and utilizing our programs and services to get more people into the workforce.”
Every March, DEED releases the revised employment numbers for the past several years. These annual benchmarking revisions always result in shifts for some months of data for the unemployment rate, the labor force participation rate and the job count. Any time data has been revised from previous reports, this is marked by (revised). The revisions always happen because of new population controls, new seasonal adjustment factors, and more comprehensive employment counts becoming available. One key result of new revisions is an update to Minnesota’s record low unemployment in 2022. While the June rate was revised up from 1.8%, Minnesota’s lowest unemployment rate in 2022 was 2.3% in April — still an all-time record low in the state.
“Our biggest month-to-month job growth in nearly a year indicates our labor market is still very tight but not so tight as to greatly constrain job growth,” said DEED Labor Market Information Director Angelina Nguyen. “This is good news for employers and job seekers.”
Over the month in Minnesota, eight supersectors gained jobs on a seasonally adjusted basis from December to January, including notable growth in the following:
• Construction gained 2,200 jobs, 1.7%
• Trade, Transportation, and Utilities gained 1,300 jobs, up 0.2%
• Professional & Business Services gained 6,600 jobs, up 1.7%
• Education and Health Services gained 2,000 jobs, up 0.4%
• Government gained 2,100 jobs, up 0.5%
Over the year, Minnesota gained 68,807 payroll jobs, up 2.4%. The private sector gained 60,741 jobs, up 2.5% over the year. These gains put total nonfarm employment 29,504 jobs short of January 2020 employment and 15,134 jobs short in the private sector.
All supersectors posted positive annual growth except one. These are the noteworthy changes:
• Leisure & Hospitality continued strong recovery from the pandemic, posting the largest growth (up 20,770 jobs) and outpaced the national rate (8.9% in MN, 8.3% in the US). This growth was driven by double-digit percentage increases in Arts, Entertainment, and Recreation, and Accommodation.
• Education & Health Services saw the second largest over-the-year growth, up 14,461 jobs (2.7%), mostly driven by growth in Ambulatory Health Care Services, Nursing and Residential Care Facilities, and Social Assistance. However, Minnesota’s job growth in this supersector is lower than that of the US, 2.7% vs. 4.2%.
• Trade, Transportation & Utilities saw healthy growth, adding 9,235 jobs (1.8%), outpacing the US by 0.1%. Growth was driven by Building Material and Garden Equipment Dealers, Transportation and Warehousing, and Sporting Goods, Hobby, Musical Instruments and Miscellaneous Retailers, in spite of declines in General Merchandise Retailers and Department Stores.
• Manufacturing was up 7,519 jobs (2.4%). Information grew 3.2% with 1,444 more jobs.
• Government posted positive growth over the year, up 8,066 jobs (2%).
• Mining & Logging was the only supersector that saw negative growth, a negligible 25 jobs loss (0.4%)
U.S. employment grew 3.6% over the year with the private sector up 4.1%. Nationally, all supersectors showed stronger gains over the year than Minnesota sectors except three which were stronger in Minnesota: Trade, Transportation, and Utilities; Leisure & Hospitality; and Government.
Minnesota and U.S. Employment and Unemployment – January 2023
- Seasonally Adjusted Not Seasonally Adjusted
Unemployment Rate January 2023 December 2022 January 2023 January 2022
Minnesota 2.9% 2.9% (revised) 3.3% 3.7% (revised)
U.S. 3.4% 3.5% (revised) 3.9% 4.4% (revised)
Non-Farm Jobs January 2023 December 2022 Jan. '22 - Jan '23 Level Change Jan. '22 - Jan '23
Minnesota 2,972,800 2,958,700 68,807 2.4%
U.S. 155,073,00 154,566,000 5,334,000 3.6%
Minnesota unemployment rate by race and ethnicity - 12 Month Moving Averages – January 2023
Month/Year Total White Black Hispanic
January-2023 2.5% 2.2% 3.6% 3.3%
December-2022 2.6% 2.3% 3.9% 3.8%
January-2022 3.7% 3.4% 6.2% 5.2%
Over the month change -0.1% -0.1% -0.3% -0.5%
Source: Current Population Survey Demecon, 12-month moving averages. This data is volatile because of the small sample sizes. Monthly data is currently only available for the listed racial and ethnic groups.
Minnesota and U.S. Over-the-Year (OTY) Employment Change, Not Seasonally Adjusted: January 2022-January 2023
MN OTY Job Change MN OTY Growth Rate (%) US OTY Growth Rate (%)
Total 68,807 2.4 3.6
Private 60,741 2.5 4.1
Mining & Logging -25 -0.4 6.7
Construction 1,058 0.9 4.9
Manufacturing 7,519 2.4 3.3
Trade, Transport. & Utilities 9,235 1.8 1.7
Information 1,444 3.2 6.4
Financial Activities 531 0.3 2.9
Prof. & Business Services 4,831 1.3 4.5
Ed. & Health Services 14,461 2.7 4.2
Leisure & Hospitality 20,770 8.9 8.3
Other Services 917 0.9 4.1
Government 8,066 2.0 1.0
Metropolitan Statistical Area (MSA) Over-the-Year (OTY) Employment Change, Not Seasonally Adjusted: January 2022 – January 2023 (December 2021 – December 2022 for border state MSAs due to data delay from MSAs outside Minnesota.)
Metropolitan Statistical Area OTY Employment Change (#, NSA) OTY Employment Change (%, NSA)
Minneapolis-St. Paul MN-WI MSA 37,063 2.0
Duluth-Superior MN-WI MSA 2,891 2.3
Rochester MSA 2,374 2.0
St. Cloud MSA 3,047 3.0
Mankato MSA 2,455 4.5
Fargo-Moorhead ND-MN MSA (unrevised December) 200 0.1
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. In addition, see related articles about job growth and labor market changes in the latest issue of Minnesota Employment Trends. Access resources to help Minnesotans prepare for and find employment now at CareerForceMN.com/GoodJobsNow.
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.