Slow, but sure, recovery under way, Minnesota official says
It happens every winter.
Unemployment goes up in Duluth and the Northland as construction goes on hiatus, and summer tourism and hospitality jobs are months away.
The downward trend in the jobless rate seen for much of 2013 ended in November for the most of the region. But not for Duluth. The jobless rate continued to drop in November, reaching 4.6 percent, the lowest point since late 2007.
It took Duluth another month to see the inevitable seasonal uptick, rising to 5 percent in December, according to the most recent state data.
Meanwhile, Northeastern Minnesota already is up a full percentage point since reaching a five-year low of 5.3 percent in October.
But Jan Saxhaug, the regional numbers guy with the Minnesota Department of Employment and Economic Development, isn't concerned.
"The increases are entirely seasonal," the labor market analyst said. "Winter always slows down."
The increase, however, may have been less if not for the difficult and unusually cold winter we've had so far, Saxhaug said.
"A lot of construction shuts down in the winter," he said.
"But I suspect a lot of the construction that does continue in the winter is down, too, and more has been shut down."
The numbers bear that out.
Initial unemployment insurance claims were up 21 percent in December for the seven-county Arrowhead region, compared to December 2012. Almost half were in construction jobs, Saxhaug said.
Construction typically takes up about half of the December claims. So the greater the total initial claims, the greater the number due to construction job losses, he explained.
"That's definite evidence that construction has taken a pretty hard hit," Saxhaug said.
But overall, beyond just the initial claims, last December fared better than December 2012 for Duluth and Northeastern Minnesota. Despite a smaller labor force, defined as those working and looking for work, there were more jobs and fewer people on the unemployment rolls.
And look at December jobless rates going back to 2007, before the recession, and it's clear the region is nearly there.
"It tells you that we're recovering slowly but surely," he said. "The fall unemployment numbers were lower than before the recession. Over summer and fall, when we were at peak employment in the region, one can make the argument that we're not that fully recovered. But we're getting there."