Construction hiring added speed to Minnesota's jobs comeback last month

Minnesota's job recovery sped up in March with the addition of 21,600 jobs, which pushed the state to its highest employment level thus far during the pandemic.

That was an acceleration from the month before, when the state gained back 12,400 jobs, a figure recently revised downward. And it meant the state surpassed its previous pandemic peak of October, just before a surge in COVID-19 cases, by nearly 20,000 jobs.

"We still have a long ways to go, however," said Steve Grove, commissioner of the Minnesota Department of Employment and Economic Development (DEED).

The state has now recovered 225,200 jobs, or 54% of the 416,000 jobs lost from February to April last year.

The number of Minnesotans receiving unemployment benefits also has been declining, but still remains quite elevated at about 280,000, down from 300,000 a month ago.

Construction, which saw jobs dip in February after a cold snap, more than made up for those losses and led the way with gains in March with 7,900 jobs. That industry is now down only 1.9% for the year.

It was followed by professional and business services, which added 5,500 jobs; leisure and hospitality, which went up by 4,300 jobs; trade, transportation and utilities, which gained 3,900 jobs; and manufacturing, which added 1,900 jobs.

Those gains were offset by losses in government, which was down 1,700 jobs; financial activities, which lost 500 jobs, and information, which declined by 400 jobs.

The state's unemployment rate fell slightly in March to 4.2%, down from a revised 4.4% in February. But the decline was not attributed to people finding jobs as economists might hope for, but once again because another 7,400 Minnesotans left the labor force.

In total, there are now about 93,000 fewer Minnesotans in the workforce compared with levels before the pandemic. The state's labor force participation rate dropped two-tenths of a percent to 67.8% in March. It was at 70.2% in February 2020, before the effects of the pandemic.

With more than 100,000 job vacancies in the state, Grove said he's eager to see more Minnesotans consider switching industries or coming off the sidelines. He said there still seems to be some hesitancy to return to in-person jobs, particularly with the new COVID variants circulating.

"The key to our recovery remains in people getting vaccinated as soon as possible," he said, adding that the state has been doing outreach to specific sectors with a push to vaccinate food service workers last week. A drive to vaccinate manufacturing workers is the focus this week.

Minnesota continues to perform better than the nation as a whole, with the U.S. unemployment rate recently falling to 6% and the U.S. labor force participation rate inching up to 61.5%.

However, people of color in Minnesota continue to be disproportionately affected by job losses. Based on 12-month moving averages, the unemployment rate for Black Minnesotans declined to 9% in March, from 9.2% the month before. That's double what it was a year ago.

Meanwhile, the Latino unemployment rate ticked up two-tenths of a percent to 7.7% in March. The unemployment rate for white Minnesotans was unchanged at 5.9%, also based on the 12-month moving average.

Kavita Kumar • 612-673-4113 Twitter: @kavitakumar