State jobless rate rises to 6 percentby Annie Baxter, Minnesota Public Radio
Minnesota's unemployment rate ticked up in October to 6 percent, up a tenth of a percent from the month before. The Department of Employment and Economic Development says the state lost 7,500 jobs last month.
Minneapolis — Minnesota's jobless rate did go up in October. However, the state's 6 percent rate is less than the nation's, which leapt to 6.5 percent last month. Minnesota used to outperform the U.S. average on a regular basis, but in the past two years, the state's jobless rate has tracked with, or fared worse, than the rest of the nation's.
Commissioner Dan McElroy of the state's Department of Employment and Economic Development, or DEED, said it's encouraging to see a gap emerge between the state and national jobless rate, especially given economists' expectations that the national rate will keep climbing.
"Being half percent below the national average is fairly significant," McElroy said. "It's not chopped liver, to coin a phrase. It's not good news, and we continue to work both with individuals and employers to do what we can to create jobs, but half a percent is not insignificant."
The half-percent wedge between Minnesota's jobless rate and the nation's is the largest it's been over the past couple of years.
But, certain sectors of the Minnesota economy have been hit hard recently. Trade, transportation and utilities shed the most jobs in October, dropping 4,800 workers from payrolls from September. That included about 3,000 retail jobs.
State labor market analyst Steve Hine said that decline is worrisome.
"I won't say it was a surprise, but certainly the weakness in retail trade one of the more glaring elements within the details of the job report this month," Hine said.
That same sector also saw job cuts by auto dealerships and transportation companies.
More job cuts piled up in manufacturing and construction, which have steadily shrunk. Construction has lost one in every six jobs since peaking in February 2006.
Between October of last year and this year, some industries added jobs. Despite turmoil nationally in the financial activities sector, Minnesota companies created 2,800 new jobs in that field.
Education and health services also pumped new jobs into Minnesota's economy. That sector added 7,100 new workers.
Hine said health care is the state's strongest sector and the biggest source of over the year job gains. However, the industry is starting to cool.
"We're starting to see a slowing in the rate of growth there that we did not see during the 2001 recession, when that sector just continued to add jobs at a rapid rate," Hines said.
But, Hine adds, he doesn't have a clear account of why health care is growing slower than in the last recession.
The officials from DEED delivered their news about the job numbers at one of the state's workforce centers on Lake Street in Minneapolis. Upstairs, in one of the classrooms, jobseekers struck a surprisingly upbeat tone.
They were clustered around a table, playing a game in a class that teaches them how to find and hold onto a new job.
It's part of a two week program called "Employment Readiness U." Job hunters who commit to the program get extra training and job counseling.
"And now that I'm done, I feel like I can go home and actually put out a good resume," said Brian Donovan.
A month ago, Donovan lost his job doing medical claims billing. He said he hasn't had to look for a job in 10 years, never wrote a resume, and had never gone through a real job search before. He said the workforce center class changed all that.
"I feel a hundred and million times better than I did when I walked in teh door," Donovan said.
Down in the lobby of the workforce center, job hunter James Taylor seemed a lot less chipper about his work prospects.
In July, he lost a job doing industrial quality control. Since then, he said he's trudged in to the workforce almost every day, looking for a new gig.
How's it looking so far?
"Not good at all," Taylor said. "A lot of times in the past I got interviews, but now, it's like, you don't even get that."
Taylor's on unemployment, and he's not alone. In October, first time claims for unemployment insurance in Minnesota shot up by 6,200, or about 31 percent from a year ago. And with national unemployment claims hitting a 16-year high, the Senate today approved legislation to extend unemployment benefits through the holidays. President Bush is expected to sign the legislation quickly.
- All Things Considered, 11/20/2008, 5:50 p.m.