Minn. unemployment falls to 5.6 pct.

Minnesota's unemployment rate fell two-tenths of a percent last month to 5.6 percent, according to figures released today by the Minnesota Department of Employment and Economic Development.

The U.S. unemployment rate was 8.1 percent last month.

Even as the jobless rate fell, Minnesota employers were cutting payrolls, and eliminated 3,100 jobs in April.

Unemployment fell primarily because of two factors. More people gave up trying to find a job and left the work force.

But at the same time, more people reported having been paid for work in April. Those can be contract work or other employment that doesn't show up in employer payroll numbers.

DEED Commissioner Mark Phillips says most signs point to employment growth over the long term despite the job losses in April.

"The economy continues to move in a positive direction, with fundamentals remaining relatively strong and better than a year ago," he said.

But job growth in Minnesota lags the national average. Over the past twelve months, the state has gained 14,700 jobs, a growth rate of 0.6 percent. That's less than half the U.S. rate of 1.3 percent.

In Minnesota last month, manufacturing led all sectors with 2,200 additional jobs, followed by financial activities (up 2,000) and education and health services (up 1,600). Logging and mining held steady.

Job losses were concentrated in the services sector: trade, transportation and utilities (down 3,400), construction (down 1,600), leisure and hospitality (down 1,400), government (down 1,000), professional and business services (down 1,000), other services (down 300) and information (down 200).

In the state Metropolitan Statistical Areas, job gains occurred in the past 12 months in Mankato (up 1.4 percent), St. Cloud (up 0.6 percent) and Minneapolis-St. Paul (up 0.3 percent). Payrolls shrank in Rochester (down 1.1 percent) and Duluth-Superior (down 1.6 percent).

NATIONAL UNEMPLOYMENT AID APPLICATIONS HOLD STEAD

Nationally, the number of people seeking unemployment benefits was unchanged last week, suggesting steady gains in the job market.

The Labor Department said Thursday that weekly unemployment aid applications stayed at a seasonally adjusted 370,000, the same level as the previous week. The four-week average, a less volatile measure, fell for the second straight week, to 375,000.

Applications for benefits surged in April to a five-month high of 392,000. They have fallen back since then and are near the lowest levels in four years.

The decline suggests hiring could pick up in May after slumping in the previous two months. When applications drop below 375,000 a week, it generally suggests hiring is strong enough to lower the unemployment rate.

The unemployment rate has fallen from 9.1 percent in August to 8.1 percent last month. And employers have added a million jobs over the past five months.

(The Associated Press contributed this report.)