Minnesota’s job growth stopped in August, latest report shows

After seeing strong job growth the past few months, Minnesota’s trend was halted in August, according to the latest jobs report released Thursday.

The Minnesota Department of Employment and Economic Development (DEED) says the state actually saw a loss of 3,100 jobs last month, a 0.1% decrease from July on a seasonally adjusted basis.

Additionally, the state’s unemployment rate ticked up 0.1% from its all-time low to 1.9% last month. Nationwide, the U.S. unemployment rate rose 0.2% to 3.7% last month.

Minnesota’s labor force participation rate also dropped 0.2% in August, falling to 68.2% overall, compared to the nationwide rate of 62.4%, a 0.3% increase from July.

While the report shows regression, DEED says the state remains in a strong spot and chalked up August’s data to less consistent job growth since the pandemic.

“We saw a pause in our job growth in August, amidst an otherwise record-setting year for Minnesota’s economy,” DEED Commissioner Steve Grove said in a statement. “Despite the fluctuations we’ve seen in the global economy, Minnesota’s resiliency remains strong. Our number one focus continues to be on connecting job seekers and businesses during a time of opportunity for Minnesota’s labor market.”

While Minnesota has been doing well in many job trends over the past several months, it continues to struggle with racial disparities in the job market.

Last month, labor force participation increased to 80.4% for Hispanic workers, stayed level at 68.6% for white workers and dropped to 66.8% for Black workers. DEED says labor force participation rates are up for all groups of workers this year but not yet to pre-pandemic levels for Black and white workers.

Unemployment has also been uneven, with Black Minnesotans seeing a significant improvement since July but still well above pre-pandemic levels, and Hispanic workers experiencing the exact opposite. In February 2020, the unemployment rate for white workers stood at 3% compared to 4.5% for Black workers and 5% for Hispanic workers. As of last month, those rates were at 2.3% for white workers, 6.6% for Black workers and 3.6% for Hispanic Minnesotans. Last month’s rates represent a 0.1% drop in unemployment for white workers compared to July, a 0.7% drop in unemployment for Black workers and a 0.4% increase for Hispanic workers.

Additionally, wages for Minnesotans increased last month and 5.8% over the year but are still lagging behind the rate of inflation, which moved up 0.1% last month and 8.3% over the year.