Slight drop in unemployment not result of healthier labor marketby Annie Baxter, Minnesota Public Radio
ST. PAUL, Minn. — Minnesota's unemployment rate fell slightly to 5.6 percent in April, but the improvement did not come about as a result of a healthier labor market.
Instead, the share of Minnesotans participating in the job market dropped in April. Some were unemployed workers who gave up on their hunt for work and were no longer counted as unemployed, artificially making the unemployment rate look better.
While the job market has enjoyed growth, it's still not strong enough to persuade some people to keep looking for jobs, said the state's head labor market analyst, Steve Hine.
"Many of those people that are not participating are likely to be people who just had an experience of a long spell of unemployment and, without any success, have discontinued searching," Hine said.
The state unemployment rate inched down two-tenths of a percent last month to 5.6 percent as fewer people looked for work. Over the past 12 months, Minnesota's economy has added 17,400 jobs, a gain of 0.6 percent. The numbers come from the US Bureau of Labor Statistics.
Hine disagrees with the BLS calculations and thinks the report actually overstates weakness in the labor market. The report, produced by a federal agency and not by the state, says in April Minnesota employers cut 3,100 jobs, mainly in the retail, construction, hospitality and government sectors.
"If I were to have to revise these numbers today, we would see something more like a 2.2 percent rate of growth April to April rather than 0.6 percent," Hine said.
Hine says several other labor market indicators show a much stronger employment situation than the BLS numbers do.