Minnesota jobless rate fell slightly in April

  • Article by: DEE DEPASS , Star Tribune
  • Updated: May 19, 2011 - 11:36 PM

But that month's loss of 5,200 jobs was countered by revised March numbers showing 5,500 job gains.

April showers contributed to the loss of 5,200 jobs last month, the Minnesota Department of Employment and Economic Development reported Thursday. Yet Minnesota's unemployment rate fell 0.1 percentage point to 6.5 percent.

April was disappointing, said Steve Hine, director of the Minnesota Labor Market Information Office. "A lot of the weakness we saw ... was due to the weather."

Minnesota's big jobs decline was mostly in construction, which lost 5,700 jobs for the month on a seasonally adjusted basis. It marked the second-highest loss in that sector on record.

The U.S. unemployment rate rose slightly to 9 percent in April, a month in which the nation added 244,000 jobs, the most since February 2006. The improved national scene caused optimism that Minnesota might also have big job gains for April. It was not to be.

"Colder-than-normal temperatures in April might have been a factor, but next month's report will give us a better indication of whether that was the case," said Mark Phillips, commissioner of employment and economic development. "The loss of construction jobs followed two consecutive months of growth in that sector."

Part of the April decline was offset by revised March figures that improved for all sectors from 2,800 to 5,500 total job gains.

Cold and wet weather appeared to trip up a number of sectors besides construction. Retailers normally see more robust activity in home and garden centers, and landscapers normally crack into more projects to spur hiring during the month, Hine said. That didn't happen this year.

As a result, retail, which falls under trade, transportation and utilities lost 2,800 jobs during the month.

The state's leisure and hospitality sector led all industries in April, gaining 3,100 jobs. Hine noted that a deeper look into figures revealed an upswing in business in bars, restaurants and lodging during the month. That means consumer confidence and discretionary spending are up -- a positive sign, he said.

Manufacturing, a strong performer for much of the last year, lost 300 jobs. That's "nothing alarming," Hine said, noting that the loss "comes after three straight monthly gains of 3,000" jobs.

The state's 5,200 seasonally adjusted job losses come at the same time the unemployment rate fell 0.1 percentage point, to 6.5 percent. The disparity stems from the two different surveys the state uses to calculate each figure. A household survey is used to determine the rate of job growth. An employer payroll survey is used to get actual jobs numbers. Last month, the surveys posted a gap in jobs numbers that proved one of the largest on record. State officials tend to place more weight on the payroll survey reported by employers.

Wells Fargo economist Scott Anderson said, "Those differences get revised out over time. But we don't know which one is right, right now."

"If you look at the payroll data ... it really appears that Minnesota's job growth engine is losing altitude. With the April data, this is the fourth month of underperformance ... in terms of year-over-year employment growth," Anderson said. He was particularly saddened to see the drops in manufacturing and retail jobs.

"You are starting to think, where will the growth come from in the future?"

In a separate report Thursday, the U.S. Department of Labor said initial claims for unemployment across the nation were 409,000 for the week ended May 14, a decrease of 29,000 from the previous week's revised figure of 438,000. The four-week moving average was 439,000, an increase of 1,250 from the previous week's revised average of 437,750.

Dee DePass • 612-673-7725

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