Duluth unemployment drops to 5.6 percent in November

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Unemployment continued its seasonal slide in Duluth, dipping to 5.6 percent in November, its lowest point since late 2008.

That’s down from October’s 5.9 percent and the year’s high of 7 percent in February and March.

“It’s definitely shows Duluth is doing better than the country as a whole and just as well as the state as a whole,” said Drew Digby, president of the Duluth Planning Commission.

Duluth’s 5.6 percent compares to 5.1 percent statewide and 7.4 percent nationwide (not seasonally adjusted; adjusted rates, which are higher, are not available for the Duluth area).

Although Duluth’s jobless rate is at a four-year low, there’s still room for improvement, said Julia Collins, regional analyst for the Minnesota Department of Employment and Economic Development. She noted that Duluth’s average jobless rate for the month of November from 2000 to 2010 was 4-5 percent.

“So 5.6 percent indicates that the recovery is not over yet, and it can probably go lower than that,” she said.

Elsewhere in Northeastern Minnesota, the jobless rate inched up in November, bucking the typical seasonal dip that lasts through the holidays, data released by DEED this week show.

The unemployment rate rose from 6.1 percent in October to 6.5 percent in November in Northeastern Minnesota, as both the labor force and the number of jobs dropped while the number of people on unemployment increased. But if you exclude Duluth, the rate rose to 6.8 percent, the data shows.

Collins said a statewide loss in 200 mining and logging jobs from October to November was largely felt in Northeast Minnesota.

Duluth fares better than other parts of Northeastern Minnesota because its economy doesn’t depend on a single industry or a handful of industries, said Digby, a former labor-market analyst.

“The rest of the region is not as diverse as Duluth,” he said. “So the area outside of Duluth is more susceptible to seasonal trends.”

That includes the winter hiatus of many construction jobs.

The greater Twin Ports area, which includes all of St. Louis, Carlton and Douglas counties, also saw an early rise in the jobless rate, from 5.9 percent in October to 6.1 percent in November as 1,150 fewer jobs were recorded and nearly 915 were added to the labor force.

Many of the job losses were in manufacturing which has slowed.

“For over two years, manufacturing was leading our recovery, but that’s ending” Digby said.

From August 2010 to November 2012, the year-over-year number of manufacturing jobs went up. But that changed last month as the number of manufacturing jobs declined compared to November 2011.

“Now it’s pretty stagnant,” Digby said. “It means for Duluth, recovery has to come from a variety of industries, not just manufacturing.”

He said that decline in manufacturing jobs is also being seen statewide, though the sector is still growing slightly in Minnesota.

“In manufacturing, our region is just a little weaker than the rest of the state,” he said.

Duluth’s 5.6 percent unemployment rate is not expected to last. Higher unemployment is likely by January.

“We’ll see the usual winter rise, especially when a lot of Christmas-related jobs disappear,” Digby said. “January, February and March are the toughest months for the job market.”

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