Minnesota's unemployment rate increases slightly, but Minn. officials say hiring is still strong

Five people talk on a bus
Asher Tholl talks about his work for the Minnesota Valley Transit Authority with state Employment and Economic Development Commissioner Steve Grove (right) July 25 in Eagan, Minn., as Stefan Evers cleans a window and John Jamer (seated) and Parker Leagjeld listen.
Tim Nelson | MPR News

Minnesota’s unemployment rate ticked up slightly in August to 1.9 percent.

That’s up from the state’s record-low 1.8 percent in July. It’s still much lower than the national unemployment rate, which was 3.7 percent in August.

Employment and Economic Development commissioner Steve Grove called it a “pause” that can happen at this time of year.

“We're of course tracking this and looking at it, but not speculating too much on what it means,” he said. “I think we're going to continue to take these longer-term, several month views to get a sense for just what our economy is looking like.”

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In July Amid record low unemployment, Minnesota officials highlight underutilized labor pools

At the same time, labor participation fell by two-tenths of a point to 68.2 percent. The national  labor force participation rate is 63.4 percent for August.

On a seasonally adjusted basis, the state lost 3,100 jobs last month. Grove said that isn’t all that worrisome to him at this point.

“I think because of the fact that we're not seeing massive layoffs by Minnesota companies, we're not seeing our unemployment insurance numbers shift really at all,” Grove said. “We're hearing from employers across the state that they're hiring hand over fist. We think a lot of the fundamentals here still point to just the fact that employers need workers and that, you know, jobs are there.”

Unemployment for Black Minnesotans dropped from 7.3 percent to 6.6 percent between July and August, but the rate is still much higher than August 2021’s 3.6 percent.

Hispanic Minnesotans saw an increase in unemployment to 3.6 percent, up from 3.2 percent in July. That’s still down from August 2021, when the rate was 5.5 percent.