Hibbing takes it hard: 18.7% June unemployment

It’s roughly a five hour drive from Moorhead to Hibbing. But those Minnesota towns live on different planets when it comes to unemployment.

Hibbing’s jobless rate hit 18.7 percent for June, twice what it was a year ago and four times greater than Moorhead, the state Labor Department reported Tuesday.

Hibbing’s was the highest among Minnesota’s major cities, with Virginia, another Iron Range town, recording 17 percent. (Those are seasonally unadjusted

Rangers have ridden the economic roller coaster for years. This cycle, though, seems particularly difficult.

News from the Duluth Ports Authority today that shipments of taconite, that vital piece of Range economy, are down 61 percent from last year, didn’t make the jobless numbers easier to take.

“I don’t think the higher unemployment rate is a surprise to anyone who lives or does business here,” says Lory Fedo, a source in our Public Insight Network who heads the Hibbing Area Chamber of Commerce. Fedo told us today:

Much of the job loss is due to the idling of Hibbing Taconite and Keewatin Taconite as well as layoffs at the other mines and mining vendor business.

The hardest pill to swallow is the fact that last year at this time we were looking at a boom in the local economy and for the first time in decades people were not afraid to invest in growing their businesses or were hanging on just to get to the boom.

We were hopeful and excited to be a part of a new era. We still have great hopes for projects like Essar Steel and the nonferrous projects proposed north of Hibbing I firmly believe these projects will be a big part of Hibbing’s economic future.

Jesse Dahl, another Ranger and Network source, says building trades are doing fairly well right now:

All electricians are out working, and there are also travelers from all over the state. The same is true for Pipe fitters. Carpenters are a little slow, I think its due to the lack of commercial jobs in the area.

“The governor’s budget cut a lot of money for this area,” adds Dahl, who was an unemployed electrician last year but trained for solar installation and has found steady work. “Towns, hospitals, nursing homes and the like have had to lay off. Those are some of the biggest employers in the area.”

While Moorhead’s the extreme, Duluth might be a better comparison to Hibbing. Duluth’s June jobless rate hit 8 percent, better than the region around it.

Duluth’s been able to reinvent itself over the years from a “classic old Great Lakes natural resources city” to one with a more diverse economic base including health care, technology and higher education, says Drew Digby, who tracks the region for the Minnesota Department of Employment and Economic Development.

That might be a good lesson. While mining jobs are “incredibly good” and pay well, says Digby, “getting back to the same (pre-recession) level of employment could take a long time.”

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