Economic outlook brightens as Minnesota adds 10,300 jobs

Positive news finally broke into Minnesota’s bleak economic story today when the officials who track the workplace announced that the state added 10,300 jobs in July and its unemployment rate fell to 8.1 percent.

It was the first month the state has gained jobs since August 2008.

But officials diluted their celebratory tones with a good share of caution.

“It doesn’t automatically mean that we have hit a turning point or the recession is behind us,” Dan McElroy, commissioner of the Department of Employment and Economic Development (DEED), told reporters in a conference call announcing the new numbers.

“If we can string three or four months together of positive news, I’ll be more confident,” McElroy said.

The state’s seasonally adjusted unemployment rate of 8.1 percent was down 0.3 percent from June. By comparison, the national rate in July was 9.4 percent, down from 9.5 percent in June.

Arguably better than the numbers was the fact that Minnesota’s job gains were widespread. Eight of the 11 industry sectors the state tracks gained jobs during July. The leisure and hospitality industry led the pack, adding 3,900 jobs.  Manufacturing, a key to recovery in so many parts of the state, added 1,700 jobs.

The Twin Cities area is picking up jobs a bit faster than the rest of the state, McElroy said. Northeastern Minnesota – hit hard by shut downs in mines and wood product plants – is struggling.

More important than where we have been is where we are going. In that regard, DEED surveyed employers around the state and reported that 95 percent of them expect to add hire workers through the remainder of the year or at least hold steady. Only 5 percent expected more cuts.

“We regard that as quite positive,” McElroy said.

Federal stimulus dollars are helping Minnesotans, McElroy said, especially in benefits for those who lost jobs during the recession. But construction hasn’t gained jobs as fast as some economists expected. Nor have retail trade, transportation and utilities.

“The jury is still out on the jobs front,” McElroy said.

You can read the full unemployment report and related details here.

Comments (2)

  1. Submitted by Sheila Ehrich on 08/20/2009 - 12:01 pm.

    Now wait a minute. The Daily Glean has MPR’s Annie Baxter reporting that manufacturing jobs are down for probably 17 straight months. Yet you are reporting that maufacturing gained 1,700 jobs. Which is it? Did manufacturing “gain” 1,700 “new” jobs, but “loose” more jobs than that in terms of “old-once-filled jobs”??

  2. Submitted by Sharon Schmickle on 08/20/2009 - 03:19 pm.

    Sheila, I can’t speak for the numbers in the Glean. But I can tell you the number used in this report was from this paragraph in DEED’s July job report:

    Eight of the state’s 11 industry sectors gained employment during the month, led by leisure and hospitality, which added 3,900 jobs. Other gains were posted by government (up 2,800), manufacturing (up 1,700), professional and business services (up 1,700), education and health services (up 1,200), construction (up 700), logging and mining (up 200), and financial activities (up 100).

    The MPR piece covered in the Glean may have been referring to the fact that the state still has a long way to go to make up for all of the manufacturing jobs it has lost since the recession started.

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