The jobless rate for much of Northeastern Minnesota shot back up in January to its highest point since 2011.
Duluth's rate reached 7.2 percent, up from December's 5.8 percent, according to data released this week by the Minnesota Department of Employment and Economic Development. While the region's unemployment rates typically increase after the holidays, this year's 1.4 percent rise for Duluth is more than usual.
"It was a tough January," said Drew Digby, the region's former labor analyst for DEED who still follows the numbers. "Normally it's our hardest season, but people cut back more than usual."
The larger Northeastern Minnesota area saw an even bigger jump in unemployment, from 6.9 percent in December to 8.6 percent in January. The 1.7 percent one-month leap came with a loss of 4,000 jobs, 2,800 more people on unemployment and 1,000 fewer in the labor force, defined as people working or actively looking for work.
"Similar trends were seen around the state," said Monte Hanson, a DEED communications specialist. "They shot up. It's the same story throughout the state."
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A sampling shows unemployment increased from 12.7 percent to 15.7 percent in Brainerd, from 5.5 percent to 6.5 percent in St. Paul and 5.4 percent to 7 percent in St. Cloud.
Hanson speculated that this year's cold January was a factor, reducing the amount of outdoor work that could be done compared to the mild winter of 2012.
While industries in Northeastern Minnesota had their typical seasonal layoffs, each laid off more workers than last year, Digby noted.
He said one reason is the softened taconite industry. That has likely resulted in less overtime and less money in the regional economy. It would also affect spinoff jobs that support the taconite industry, he said.
"It would have a trickle effect in Duluth as well as across the region," he said.
Economic uncertainty generated by politics in Washington, D.C., also enters in, observers say.
"With all that's happening at the federal level, a lot of people are scared," Digby said. "So there's a lot of seasonal layoffs and a reluctance to hire."
But Digby also saw hope in the numbers. The underlying trends in the unemployment statistics show growth in every category over January 2012, he said.
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"We were on a good trend, but the post-Christmas season hit us harder," he said. "The reality of the job market today is when companies feel anxious, they don't wait to take action if it will help their bottom line. Layoffs happen faster."
Regional unemployment rates typically start to drop in April as the hiring for construction, tourism and other warm-season jobs begin.
"It will take a few months to see underlying strengths take off," Digby said. "Positive signs are showing up but not as fast as people want them to."
