Minnesota’s jobs picture: Gulp!

We were hoping the data released today on Minnesota unemployment for December would show we had turned the corner — that if we didn’t see a big drop in unemployment, we’d at least see a jump in new jobs created and an end to the exit of Minnesota’s labor force.


Instead, jobs took a cliff dive — 22,400 fewer jobs in December versus to November, the biggest monthly drop since at least 1990.

Those December losses cut the state’s over-the-year job gains nearly in half to 29,300 for 2010.

Meanwhile, the state’s total labor force continued to slip. While it was only a few hundred from November to December, some 35,000 Minnesotans have left the labor force since April.

As we’ve noted before, in a recovering economy, the opposite should be happening — discouraged workers who left the work force in bad times are supposed to be returning along as opportunities increase.

Here’s our updated chart (click on the chart for a larger view)


We’ve heard various explanations — people left the the work force to go back to college makes the most sense — but there’s something not right here.

Collectively, the questions really neutralize the down tick in the unemployment rate from 7.1 percent to 7 percent.

They are also delivering a hard reality: It’s going to be tougher than expected for Minnesota to recoup the jobs lost in the recession.

State officials in November were predicting it would take until mid-2013 for Minnesota to restore the job numbers lost and noted the state would need to add about 2,000 jobs a month to simply keep pace.

“This slower pace of job creation … over the next 6 to 12 months will continue to make it very difficult to put the state’s unemployed, displaced, and underutilized workers back to work promptly,” according to the state economic outlook.

Again, that was in November, before the job gains data for 2010 got nearly halved.

Looking for bright spots, state officials in today’s press release highlighted how much manufacturing has come back in the recovery and how important that is.

True, but we’re not even close to recovering the manufacturing jobs lost in the recession.

Here’s a chart showing employment in Minnesota manufacturing since 1990 (click on the chart for a larger view).SMS27000003000000001_17921_1294080327126.gif

Coincidentally, the Minnesota Home Ownership Center today came out with data showing Minnesota pre-foreclosure notices up 8 percent overall in 2010 but 15 percent in greater Minnesota.

In a brief Twitter discussion, the center noted:

unemployment & underemployment are the #1 reason people fall behind. Foreclosures will decrease with econ recovery.

People with jobs keep the economy rolling and ultimately more jobs will mean better times for housing and other parts of the economy. But we need Minnesotans to stop leaving the work force and we need jobs.


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