MN Dec. Jobs Numbers Disappoint, Unemployment Still Falls

MN Dec. Jobs Numbers Disappoint, Unemployment Still Falls

Noting the discrepancy, an official said December’s job declines may get revised away.

Minnesota job figures closed 2014 on a disappointing note even as the state continued to shave percentage points off its 13-year-low unemployment rate.
 
“I guess we’ll file this one under category of all good things must come to an end,” said Steve Hine—research director for the Department Labor Market Information Office of the Minnesota Department of Employment and Economic Development—in a conference call Thursday morning.
 
Hine referred to what had until recently been an almost monthly ritual of reporting rosy economic data. Though Minnesota’s unemployment rate (3.6 percent) hit its lowest point since April 2001 and is 2 percent lower than the U.S. rate for December, employers here reported shedding 5,200 jobs last month.
 

That plus revised November numbers reducing job gains by 4,000 brought total job growth in Minnesota to 33,400 in 2014. The state’s 1.2 percent job growth lagged behind national figures of 2.2 percent. The government sector lost the most jobs last month, shedding 4,200 jobs. Education and health services trimmed 1,500 jobs. Manufacturing lost 1,400 and financial activities lost 1,100.
 
Hine said government jobs lost were primarily at the local level and were enough to lower the employment level in local government/non-education jobs to its lowest mark since 2000. The federal employment level is at its lowest December level on record and state government employment fell to a three-year low for the month, Hine added.
 
For retail’s ever-important holiday season, that sector ended December with a 4.5 percent raw gain, or just shy of 13,000 jobs. This was slightly below 2013, Hine said, but both years are at levels strongest since 2006. Still, department stores continue to be a glaring weak spot: fewer workers ended the year at a department store than any December on record.
 
So how to explain the disparity between jobs lost and a continuing reduction in the state’s unemployment rate?
 
“Some declines are inexplicable,” Hine said, noting the health and local government sectors. “We don’t have many obvious culprits in any of these areas to point to. This leaves open the possibility that this is a one-month anomaly. I kind of look at this December decline in jobs as something that may get revised away. I certainly don’t see it as a likely start to a sort of weakening in state labor markets.”
 
The average hourly wage rate for all private sector jobs dipped to $25.24, or 20 cents below last December. For the year, the average rate of $25.77 came in 13 cents, or 0.5 percent, higher than 2013’s average.
 
The Mankato area gained the most jobs last year, up 3.7 percent. Both the Twin Cities and St. Cloud metropolitan areas reported gains of 1.8 percent and Rochester noted a 0.8 percent rise in jobs. The Duluth-Superior area, meanwhile, reported a 0.7 percent decrease in jobs for the year.