State sees job gains in June; biggest jump since Oct.by Martin Moylan, Minnesota Public Radio
St Paul, MN, USA — Minnesota employers added 13,200 jobs in June, with the biggest employment gain since October, and the second biggest jump since 2005.
Although employment may be rebounding, according to figures released today by the Minnesota Department of Employment and Economic Development, the state isn't close to regaining all the jobs lost in the recession.
The employment uptick was driven by the leisure and hospitality sector, which added 8,000 jobs.
Other gains occurred in trade, transportation and utilities, education and health services and government. The greatest losses were to construction, which lost 2,200 jobs.
The state unemployment rate rose by one-tenth percent to a seasonally adjusted 6.7 percent. (The jobs and unemployment rates are based on two different surveys and occasionally send contradictory signals. In June the survey of employers reported bigger payrolls, but the survey of households found fewer people reporting they'd been paid for work.)
Still, Minnesota remains well below the national unemployment rate of 9.2 percent.
State economist Tom Stinson said any time the state adds 13,000 jobs is good news but June numbers can be thrown off by seasonal factors, such as students finding summer jobs.
"The problem is that most of the jobs came about because of a change in private education and especially leisure and hospitality," Stinson said. "Both of those probably had big seasonal effects."
A longer view provides better perspective on how the state is performing on the jobs front, Stinson said.
"Over the last year, we've added 23,000 jobs," Stinson said. "If you look at how many jobs we lost because of the recession, we are still 118,000 jobs below where we were at the previous high point in employment in this state."
At the current rate job are added it'll take a long time to return to that high point, Stinson said.
"If you were not to grow any faster than we have in the past year, it would take five more years until employment got back to the place it was in early 2008," he said.
The weather wasn't great in June, but the state's leisure and hospitality industry was hot. It includes businesses such as golf courses and amusement parks, restaurants, hotels, resorts and campgrounds.
"From what we heard from our members, reservations in resorts and campgrounds were strong from Memorial Day through June," said Dan McElroy, president of industry trade group Hospitality Minnesota. "Lodging business, the occupancy rate is up. Just some slight improvement in the economy."
The construction sector's loss of 2,200 jobs in June came after it added the same number of jobs in May.
Dave Semerad is CEO of Associated General Contractors of Minnesota. He said contractors in May ramped up employment after a terrible April.
"I think this again points out that the industry doesn't have a lot of momentum."
Semerad believes the state government shutdown hurt the sector.
"I believe contractors were beginning to layoff in June in anticipation of the state shutdown." Semerad said. "The momentum that we started to develop coming out of May was lost in June.
Semerad hopes the $500 million construction bonding bill in the state budget will boost the construction industry.
Next month's employment numbers will be influenced by this month's shutdown in state government, during which roughly 22,000 state workers were laid off. Additionally, thousands private sector workers whose jobs depended on state funding or spending were affected.
Stinson expects employment numbers to indicate July's dip and then increase in August, reflecting state workers returning to work.