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Good Question: Why Is Unemployment Falling Faster In Minn. Than Other States?

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(credit: CBS) John Lauritsen
John Lauritsen is a reporter from Montevideo, Minn. He joined WCCO-...
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MINNEAPOLIS (WCCO) – While the national economy struggles, Minnesota’s unemployment rate just hit its lowest level in five years.

New numbers out Thursday show the state’s jobless rate fell to 5.2 percent last month. That’s compared to the national rate of 7.6 percent.

But it’s not new news.

We’ve been consistently lower for the past 30 years…and June numbers show that the gap has widened even more.

“We are a relatively highly educated population. We have a highly educated workforce,” said Steve Hine, a research director with the Minnesota Department of Employment and Economic Development.

“It’s been…a slow but steady improvement,” he added.

As the man behind the numbers, he said a recovering Minnesota economy and a highly-educated workforce are key factors. During the recession, a lot of Minnesotans went back to school.

“Areas like professional and business services, education and healthcare, leisure and hospitality [are] now doing well after struggling for a while,” Hine said.

The hospitality industry is doing better, he said, because people have more money to go out for dinner or to catch a movie.

The housing market has improved and that brings construction jobs.

But Hine said there are potential roadblocks.

Budget cuts from Congress, and also economic issues in Europe, make it harder to trade.

That has an impact on manufacturing jobs here.

Also, a lot of the jobs we have added are temp jobs that Hine is hoping become permanent.

“It’s what we call a leading indicator,” he said. “It may suggest that in the future, these businesses that are now going to temp help agencies will eventually turn around and hire those people or workers on a permanent basis.”

And while we are getting back to normal, Minnesota only added 400 net jobs last months.

Hine said that more than 150,000 Minnesotans are still unemployed, leaving plenty of room for improvement.

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