Job market strong; too much potential remains untapped

This is the fourth installment in an editorial series called The Changing Face of Minnesota. This year, the ECM Publishers Editorial Board is examining demographic changes and disparities in Minnesota that center around race, wealth, age, region and employment.

Job statistics can be mercurial, especially the more often you measure them. One month’s job-loss chill can be followed by a white-hot month of gains.
But the overall trajectory in Minnesota is unmistakable — this state is wide open for business.

In the eight years since the Great Recession officially ended, Minnesota has added 314,261 jobs, an 11.7 percent increase that matches the national rate, according to the state’s Department of Employment and Economic Development.

A seasonally adjusted gain of 4,400 jobs in June pushed the labor market to new heights. In part because of a weak report last June, year-over-year job gains totaled 77,478, or 2.6 percent — the largest gain since May 1998, at a growth rate not seen in nearly six years.

Minnesota’s unemployment rate is 3.7 percent, below the nation’s 4.4 percent, and its share of employment among the working-age population is at its highest level since January 2009, DEED reported last month.

Many people in Koochiching and Itasca Counties have reason to worry about their prospects, with unemployment rates of 7.8 percent and 6.9 percent, respectively. They’re a far cry from the 2.7 percent in Eden Prairie and Rochester or the 2.5 in Northfield.

Regional disparities are often affected by plant closings in smaller communities or the vicissitudes of industries such as mining and timber, whose booms and busts are facts of life in northern Minnesota.

Seemingly as predictable, and more statistically significant, is the nagging problem of underdeveloped human capital in Minnesota’s minority communities.

Despite June’s excellent job gains, racial employment disparities actually rose slightly, DEED reported. Black Minnesotans’ unemployment rate rose from 8.1 percent in April and May to 8.4 percent. Hispanic unemployment rose from 5.3 percent to 5.5 percent.

White unemployment held steady at 3.1 percent.

The Twin Cities metro area has the highest proportion of working adults among the nation’s 25 largest metro regions. But 13 percentage points separate the share of working non-Hispanic whites from that of people of color, reports the Itasca Project, a business-led civic alliance. The gap ranks the Twin Cities near the bottom of the 25 metro areas.

Gaps in employment and income persist even when education is considered. Unemployment among black high school graduates is three times higher than among white high school graduates, the Itasca Project says.

Among blacks with bachelor’s degrees or higher, the unemployment rate is double that of whites with similar education.

Growth in the Twin Cities labor force absorbed the post-recession job demands but is projected to slow in the next decade as the population ages. Though it would have seemed unthinkable eight years ago, employers and state officials are now grasping for ways to fill jobs in an ever-tightening labor market.

To capture and retain workers at a time when the region’s diversity is growing, DEED advises employers to lower barriers impeding nonwhite workers and other populations, including the disabled, youth and people with less education.

Schools, both high schools and secondary, should sharpen their focus on career-aware counseling and programs. An example is the new career Pathways program at Burnsville High School, which clusters coursework into strands that allow students to explore professional fields and even begin credentialing work.

Too many minorities with post-secondary degrees, particularly blacks, wind up in temporary jobs or other low-wage work, which depresses their earnings as a group. But when blacks are able to find jobs in industries related to their majors, wage disparities disappear, according to DEED.

People of color comprise 24 percent of the Twin Cities region’s working-age population; their ranks are projected to grow to 50 percent by 2050. Without a virtuous cycle of inclusive education, training, recruitment, employment and advancement, Minnesota’s economy will fall short of its potential.

An opinion of the ECM Editorial Board. Sun Patriot Newspapers are part of ECM Publishers Inc.