Minnesota added 7,400 jobs in April, led by construction

A huge rise in construction hiring drove a gain of 7,400 jobs for Minnesota in April, marking the third straight month of solid increases in the state job market.

Figures the Minnesota Department of Employment and Economic Development released Thursday showed the unemployment rate ticking downward to 3.7 percent as construction added 6,600 jobs on the month.

That's the largest monthly increase for construction in 25 years and a welcome shift after what had so far been a tepid spring for the industry.

"It had been weak throughout the winter," said Steve Hine, the state labor market economist. "I certainly had some hope that we'd start to see the springtime rebound in March. We didn't get that, but we more than made up for it in April."

Much of the gain in construction was in the specialty trades and heavy construction jobs. The specialty trades — which include concrete, plumbing, painting and electrical work — employ 4,000 more Minnesotans than a year ago.

Homebuilders posted only modest increases in hiring.

"We're growing and we're way better than we were in the recession, but we're not growing rapidly," said Dave Siegel, executive director of the Builders Association of the Twin Cities. "The used home market is smoking hot, and you would think that the new home market would follow, but it's not following as rapidly as we would have thought."

Professional and business services added 3,400 jobs in April, mostly in back-end business jobs. Trade, transportation and utilities added 2,200 jobs and manufacturing added 900.

"Business contacts are saying things are continuing to grow, the data shows things are continuing to grow," said Toby Madden, an economist at the Federal Reserve Bank of Minneapolis. "Across most sectors, things are looking good."

One area of concern is manufacturing, he said. While the industry added 900 jobs in April, more manufacturers are saying a strong dollar is hurting business. "You're starting to see things flattening out in manufacturing," Madden said.

The state unemployment rate ticked downward to 3.7 percent in April, a minuscule change in the face of an expanding workforce. The labor force participation rate climbed to 70.7 percent in April, its highest level since 2011.

Growth of the labor force — people either working or looking for a job — had been slowing as baby boomers and discouraged workers exited the workforce. But in the past two months, 25,000 people have jumped into Minnesota's job market.

"That is very perplexing. It's such a dramatic reversal," Hine said. "I hope it's real, because a slowing rate of growth in our labor force is one of those barriers that is going to keep us from growing as quickly as we would like."

April's losses came in government, which shed 2,500 jobs in the month, followed by education and health services (2,200). .

Job growth in Minnesota over the past 12 months was 1.7 percent, slower than the national average of 2.2 percent.

Among the state's metro areas, Minneapolis-St. Paul's job growth over the past year was 1.8 percent. Mankato, Duluth, Rochester and St. Cloud all grew less than 1 percent.