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Minnesota Department of Economic Security M E M O R A N D U M To: Governor's Workforce Development Council We hope that you have enjoyed our recent issues of Minnesota Employment
Review. You will find several stories of interest in the March and April
issues, including a "Regional Spotlight" on the wind power industry that
is springing up in Southwestern Minnesota, as well as our annual 2001
short-term forecasts and 2000 Minnesota employment growth "Supplements".
Employment grew 2.1 percent in 2000, the lowest since 1991 but still
above the national growth rate of 2.0 percent. Among industry divisions,
construction grew the fastest, at 6.6 percent, down from 1999 largely
due to higher interest rates, but still strong. Services followed at 3.1
percent growth. Only mining lost jobs, down 3 percent from 1999. Employment
has grown only about 1.1 percent in the first quarter of 2001. At the same time employment growth is slowing, news of layoffs is dominating
the media. Unemployment Insurance (UI) initial claims filed with our agency
increased 77 percent in April 2001 over April of 2000, a level not seen
since the economic slowdown in the early 1990s. While we don't know what
the outcomes for these laid-off workers will be, history tells us that
reemployment and wage outcomes for laid-off workers weaken when the economy
is weak, and strengthen when the economy is strong. We've all heard about the dot.com layoffs. While we have no way of isolating
dot.coms firms in our industrial coding structure (these companies generate
revenue in a variety of ways) we do use the Bureau of Labor Statistics
list of research and development intensive firms to examine trends in
the "high-tech" sector. Layoffs during first quarter 2001 were up 115.6
percent over layoffs during first quarter 2000. High-tech industries most
impacted include motor vehicles and equipment, aircraft and parts, communications
equipment, electronic components and accessories, nonferrous rolling and
drawing primary metals, special industry machinery, and computer and data
processing services (where many dot.coms are found). You may have noted that many of these industries are in the manufacturing
sector. In fact the manufacturing and mining sectors are being hit the
hardest in Minnesota, with claims up 125 and 137 percent respectively
over last year. In absolute numbers the services industry, which is almost
twice the size of manufacturing, has only 68 percent as many claims as
manufacturing. But the increase in layoffs is not isolated to manufacturing
and mining. Minnesota's UI claims are up 60 percent or more over last
year in all but two industries, construction and public administration.
Not surprisingly, the southwest, Arrowhead and Twin Cities regions of
the state experienced the greatest increase in UI claims last quarter
compared to a year ago, reflecting the mix of industries in those regions.
You may be wondering when we are going to tackle the 2000 Census data.
In fact the labor force data will not be available for another year or
two. What is available right now is the population count. However, we
can gain insight into the changing face of the Minnesota workforce by
examining this data. Nonwhite populations in Minnesota grew dramatically in the 1990s, evident
from Census data despite the fact that 2000 data is not strictly comparable
to 1990 data because people are now allowed to identify with more than
one race. In fact, in 1990, 6.3 percent of the total state population
identified themselves as nonwhite or Hispanic or both while in 2000, 11.8
percent of the state population were nonwhite (either alone or in combination
with white) or Hispanic or both. The largest increase was in the Hispanic/Latino population, which increased 166 percent over the 10-year period. Hispanics/Latinos are concentrated in Minneapolis, St. Paul, Willmar, Rochester and Bloomington and other Twin Cities suburbs. Almost 172,000 Minnesotans described themselves as black or African American alone, while another 31,000 said they were African American in combination with some other race - up from only 95,000 in 1990. African Americans are concentrated in the Twin Cities metro area, especially Minneapolis and St. Paul. Almost 142,000 Asian alone residents lived in Minnesota in 2000 and about 20,000 people were Asian in combination with another race - up from only 77,000 in 1990. Asian population concentrations are split between Minneapolis and St. Paul and the suburbs surrounding suburbs. Other populations grew more slowly over the decade. Despite these shifts, Minnesota is still much less diverse than the nation. For employers, these population changes may mean that bilingual work places will aid in finding and retaining staff. We look forward to rolling out the next issue of Minnesota Economic Trends,
due out in July. The feature article is entitled "Understanding Our Economy:
The life cycle of economic slowdowns." We hope that its historical perspective
will shed some light on the current slowdown. Helping People Help Themselves Achieve Economic Security |