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The state saw job growth and a small drop in unemployment, which fell to 4.4 percent in May. But that’s at least partially because fewer people are looking for jobs. 

“The unemployment rate going down is a mix of more people getting jobs, but it's also because some people are dropping out of the labor force as well,” said Angelina Nguyễn, the director of Minnesota's Labor Market Information office. “It's hard to really parse out exactly how much each factor is influencing the unemployment rate.”

In May, the state’s labor force participation rate dropped for the sixth month in a row, down to 67.2 percent. 

“This trend of decreasing labor force is across the country, but we're seeing a much faster rate of decrease in Minnesota,” Nguyễn said. “It is still too early to figure out why or what's happening, but it is something that we're keeping our eye on.”

Minnesota's job growth outpaced the national rate for the second month in a row, with the state adding 5,400 nonfarm jobs on a seasonally-adjusted basis and almost 20,000 over the year. 

Fargo-Moorhead metro lagging in job growth

While jobs were up in the state overall, the Fargo-Moorhead area lost 1,800 jobs from April 2025 to 2026, or 1.2 percent, according to the state’s latest data. 

“It is definitely starting to become a more difficult job market for job seekers,” said Samantha Ramirez, a job counselor in Moorhead who helps people find jobs through the state’s 

 program. “Some of that is the influence of AI and applicant tracking.”

Generally speaking, the Northwest part of the state is experiencing a weakening job market, according to Anthony Schaffhauser, a regional analyst with DEED.

He said in the 26-county region he covers, the unemployment rate is now higher than in the years before the pandemic.

“Conditions now are more like they were in 2014 to 2015, and that was a period when the labor market was just completing the recovery from the Great Recession,” he said.

Given that backdrop, it can be even harder for job seekers like Nikki Marie Gayton to land work. She said she’s a Certified Nurse Assistant, but her past incarceration seems to be holding her back from jobs in the Fargo-Moorhead area.

“I know I'm a good worker … My past was my past, and it was literally one mistake that I made that is changing my life,” she said. “I’m at a standstill.”

She’s been looking for a job since she was laid off in 2024. Gayton said she’s been getting help from the CareerForce program with things like getting her car fixed so that she can get herself to any interviews she lands. 

“I know something will happen for me,” she said. “Just gotta stay focused and just keep trying and trying.”

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The state added jobs last month, but people are leaving the labor force.

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Minnesota unemployment down in May, but fewer people sought work

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