Employment in Minnesota fell for the fourth straight month in August, down 25,600 since April
The Bureau of Labor Statistics (BLS) has released its employment numbers for August. Some of the local headlines include:
Kare 11: Minnesota shares largest monthly job gain in two years
Star Tribune: Minnesota posts largest monthly job gain in two years
Detroit Lakes Online: Minnesota adds over 14,000 jobs in August, the largest monthly gain in two years
KEYC: DEED: Minnesota sees largest monthly job growth in 2 years
Marshall Radio: Minnesota Posts Largest Monthly Job Gain in Two Years
KDHL: Minnesota Employers Added Most Jobs in Two Years in August
Number of jobs
Kare 11 reported that:
Employment grew by 0.5% in the state, exceeding the national average of 0.1%, according to DEED’s release.
This is true, but it is the exception to the recent record rather than the rule. As Figure 1 shows, while Minnesota’s job growth tracked that of the United States pretty closely to mid-2019, since then it has failed to keep pace. Indeed, if we look at the growth in jobs since the trough of the COVID-19 recession in April 2020, we see an increase of 17.4% in Minnesota compared to 21.7% for the United States as a whole.
Figure 1: Nonfarm job growth, Minnesota and the United States, January 2019 = 100
Number of people employed
But, as I’ve noted before, while the number of jobs is one thing, the number of people employed is another.
The number of jobs comes from the BLS’s Establishment survey which is part of its Current Employment Statistics (CES) survey. The number of people employed comes from the Household survey which is conducted by the U.S. Census Bureau as part of its Current Population Survey (CPS). What do we see when we look at those numbers?
As Figure 2 shows, the total number of people employed in Minnesota fell in August by 5,927. This was the fourth successive month of falling employment in our state leaving 25,563 fewer Minnesotans employed in August than in April.
Figure 2: Employment growth, Minnesota and the United States, January 2019 = 100
One more thing jumps out from Figure 2: there were as many people employed in Minnesota in August 2024 as there were in January 2019. In five and a half years there has been no growth whatsoever in the number of people in Minnesota who are employed.
What gives?
Since January 2019, BLS data show us that the “Civilian non-institutional population”* (population, P) has grown by 3.0% in Minnesota, or 132,072. This number, in turn, breaks down into those in the labor force who are either employed (E) or unemployed but looking for work (U) (the “Civilian labor force”) and those who are out of the labor force completely (O). This can be summarized as:
P = (E + U) + O
If we plug in the changes in each of these from January 2019 to August 2024, we see:
132,072 = ( -156 + 1,930) + 130,298
In other words, the increase in Minnesota’s population since January 2019 has been smaller than the increase in the combined number of people either unemployed or out of the labor force completely.
If you look beneath the headlines, the news is not so good.
* The Department of Labor defines this as:
Persons 16 years of age and older residing in the 50 states and the District of Columbia, who are not inmates of institutions (e.g., penal and mental facilities, homes for the aged), and who are not on active duty in the Armed Forces.