Minnesota jobless rate dips to 6.8% for June

Minnesota's unemployment rate in June fell from 7 percent to 6.8 percent, mostly because a slew of folks left the workforce. A year ago, the state's jobless rate was 8.4 percent.

Minnesota's labor force participation rate fell 0.4 percentage points to 72.2 percent as nearly 14,000 people either retired or became discouraged and gave up their job search. State officials said they don't track specific causes for workforce participation rate changes, but suspected discouragement was a factor.

Discouraged workers are not counted among the official unemployed, a fact that helped lower the state's official jobless rate in June.

The decline came despite the state losing 3,700 jobs in June as temporary U.S. Census jobs in the state faded away, state officials said, adding that the termination of census workers seemed early. During the 2000 census, jobs didn't end until September of that year, probably because a much longer survey was required at that time.

June's census results caused a decline in the state's overall temp workers for the first time in months.

Temp jobs aside, nine of the state's 11 main sectors reported job losses in June. Retail, transportation and utilities lost 3,200 jobs, followed by "other services" (down 2,800), professional services (down 2,600) and construction and manufacturing (both down 900). The information, education/health services and government sectors each lost 200 jobs during the month, while logging/mining lost 100.

The decline in manufacturing jobs ended a five-month run of positive hiring.

Steve Hine, the state's labor market information director, noted that initial claims for unemployment benefits fell in June to 27,200.

"That number was nearly 44,000 a year ago. So we are seeing far fewer people filing for unemployment benefits than we had been seeing," Hine said. "In fact, June is lower than it was just [in] October 2006, when we were in an expansionary phase of the business cycle."

Overall, Minnesota is faring better than the country. Minnesota's 6.8 percent total unemployment rate in June is far below the nation's 9.5 percent. Some 652,000 workers left the U.S. workforce in June, while about 225,000 census workers lost their jobs. The nation added only 83,000 private-sector jobs last month.

Separately Thursday, the U.S. Labor Department reported that jobless claims plunged 29,000 in the week of July 10 to 429,000. Manufacturing retooling centered in the auto sector, which delayed retooling this year, makes the report very difficult to read. The four-week average is down 11,750 to 455,250 for the lowest reading since mid May.

Dan McElroy, Minnesota commissioner of employment and economic development, said the state's June report "mirrored the nation's, reflecting the uneven nature of economic recovery. Still, Minnesota has gained more than 11,000 jobs in the past 12 months, representing the first year-over-year employment growth in the state since April 2008."

Job losses were seen in construction (down 10,200), other services (down 8,100), financial activities (down 2,200), manufacturing (down 1,100), trade, transportation and utilities (down 1,000) and information (down 60).

The Minneapolis-St. Paul metro area lost 1,900 jobs in the past year. The Mankato region lost 800 jobs. Duluth, Rochester and St. Cloud gained a respective 100, 900 and 900 jobs.