Minnesota unemployment rate ticks up a bit as more people reboot job searches

Minnesota employers added 4,400 jobs in August at the same time more people restarted job searches, a move that nudged the unemployment rate to 3.1%, state officials announced Tuesday.

August job numbers grew 0.1% from July, led by hiring in leisure and hospitality, construction, and education and health care sectors.

The month did see some job losses; in the professional and business services and financial activities sectors, for example.

State officials celebrated the job gains, and welcomed August's surge in the number of people looking for jobs. Some 3,225 people entered or re-entered the labor force last month, which helped the labor force participation rate to hold steady at 68.5%.

At 62.8%, the national labor force participation rate is nearly six percentage points lower than Minnesota's.

"More people are joining the labor force, and our continued labor force growth is great news for Minnesota employers, many of whom continue to look for the workers they need in our tight labor market," said Matt Varilek, commissioner of the Minnesota Department of Employment and Economic Development (DEED), in a statement.

Four "super sectors" in Minnesota have outpaced the nation in job growth over the year. Minnesota construction jobs rose 5,905, or 4% compared to 2.6% nationally. The government sector gained 9,293 jobs, or 2.4% compared to 1.8% nationally.

Other sectors saw much smaller gains, but the state still outpaced them nationally.

For example, trade, transportation and utilities gained 7,610 jobs since 2022. While that was up only 1.4%, it beat the national rise of 0.3%. Minnesota's information sector added just 54 jobs last year. Still, it was up 0.1% compared to a loss of 1.9% nationally.

Minnesota employers like John Norris say it continues to be difficult to find skilled workers. The executive and co-owner of the contract manufacturer Atscott Manufacturing and Tower Solutions in Pine City was thrilled to hire three new employees in August.

The new welder, assembler and machine operator brought his staff to 63.

"Manufacturers have been running on empty as far as employees for so long that I am not at all surprised that manufacturers are [finally] hiring," Norris said. "We have been looking to fill some spaces for quite some time."

It has been hard to hire for so long, companies like his switched to plan B, hiring lower-skilled workers and training them until they become certified, skilled machinists, he said.

"So we are just grateful the market has eased a little bit," he said.