“Employment conditions weakened considerably in July,” according to state labor economist Steve Hines today. Minnesota Department of Employment and Economic Development (DEED) reported a 4,200 loss of jobs in July and a downward revision by 3,600 jobs in June. The growth of 2,900 jobs for all of 2014 is ”pretty meager,” and the half percent drop of people working, now 70.1 percent is a concern.
Signs of future growth
Fortunately, Hines concludes, “Job growth and job strength is considerably greater than it seems” because the state has one of the strongest growth in job listings in the nation, increasing by 4,400. In addition, July’s unemployment rate held steady at 4.5 percent, a favorable comparison to the 6.2 percent unemployment across the U.S.
More reason for optimism
DEED Commissioner Katie Clark Sieben said, “Minnesota’s economic indicators remain positive, and underlying employment data continue to look strong.” The state has added 68,344 jobs in the past 12 months, and maintained a 2.5 percent growth rate, measuring favorably against a 1.9 percent growth rate across the U.S.
Number adjustment made for weak report
Hines explained that the Minnesota Department of Employment and Economic Development (DEED) adjusts the numbers throwing the report off. The state expects jobs to drop in every July and adjusts the raw numbers. An unusually low number in June caused by weather factors confounded the adjustment this July .
Baby boomers retiring
Hine says the labor participation rate started to rebound but seems to be showing the impact of aging demographics. “There are a lot of studies out there and most show that one-half to three-fourths of the decline in labor participation is due to the demographics (older workers retiring).” He says the number of people applying for Social Security is also increasing.