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Minnesota job gains lead to lowest unemployment rate for blacks on record

ST. PAUL — Minnesota's job market has improved to record levels for black residents although their jobless rate remains more than double the state average.

The Minnesota Department of Employment and Economic Development, or DEED, released a jobs report Thursday, Jan., 18, that showed 7.5 percent of black Minnesotans were unemployed in December. That's the lowest jobless rate for black residents since the state began keeping records in 2001.

Minnesota's rate is a dramatic decline from 2011 when, on average, 23.5 percent of black workers were unemployed, the highest rate in the state's recorded history.

Yet December's unemployment rate for blacks is higher than what white Minnesota workers experienced in 2009 at the height of the Great Recession. And the national rate was even better for black workers at 6.8 percent, the lowest level in the 45 years the federal Bureau of Labor Statistics has tracked the data.

"Minnesota's economy had a strong year, with nine of 11 major industrial sectors adding jobs in 2017 and unemployment at a 17-year low," said Shawntera Hardy, DEED commissioner. "Still, we have more work to do to connect all Minnesotans, specifically people of color, indigenous communities and people with disabilities, to employment and training opportunities to ensure that they succeed in today's economy."

Persistent disparities

Other workforce data illustrates Hardy's point.

While black unemployment is at a record low, the jobless rate for all Minnesotans is significantly lower at 3.1 percent, also a record low point for this century. The unemployment rates for Hispanics and whites remained unchanged — but still significantly lower than black Minnesotans — in December at 5 percent and 2.9 percent, respectively.

Declining unemployment hasn't necessarily translated into large gains in income for Minnesotans of color. U.S. Census data released in September showed households earnings on the rise for all racial and ethnic groups, but black and Native American residents still earn about half what their white neighbors do.

In contrast, Asian households out-earned whites with median incomes of $70,853 compared to $68,090 in 2016. Hispanics made significantly less with median incomes of $45,946, and the state median for all Minnesota households was $65,599. For black Minnesotans it was $33,436.

Gov. Mark Dayton took note of the continued economic disparities between white Minnesotans and residents of color.

"I am also very pleased to see that deep employment disparities among African Americans in Minnesota are continuing to improve," Dayton said. "Despite this progress, we have more work to do to ensure that all Minnesotans, in every community across our state, have better access to employment opportunities and growing wages."

Minnesota has some of the nation's largest racial disparities in income and economic opportunity that many attribute, at least in part, to the state's persistent academic achievement gap. Students of color routinely score lower on proficiency tests and graduate high school at lower rates than their white classmates.

Those disparities play a role in the postsecondary training students of color receive and the jobs available to them. In 2016, the state Legislature approved $35 million in new spending to address some of these opportunity gaps.

Advocates for communities of color were heartened at the time to see the new investment but have continued to characterize the state's push toward equity as not enough. They have called for more investments in workforce training and the increased availability of capital for entrepreneurs of color to start or grow businesses.

Last week, Dayton's administration announced its efforts to diversify the state's workforce were paying off, but there was still a long way to go for government employees and contractors to reflect Minnesota's population.

About 12 percent of Minnesota's state workforce are minorities, up from 8 percent when Dayton took office in 2011. For comparison, about 20 percent of Minnesota residents are people of color.

Those successes came after a state audit released last year showed many state rules for diverse hiring and contracting were not routinely followed. The administration says it responded with more training, improved recruiting and removing employment barriers for minority workers and contractors.

A look at the numbers

Minnesota gained 44,200 jobs last year, a growth rate of 1.5 percent, which matched the national rate. The state's December unemployment rate of 3.1 percent was a full percentage point below the national rate of 4.1 percent.

The data released Thursday also included a broader measure of the state's job market by including workers who are involuntarily part-time and unable to find full-time jobs and working-age residents who have given up their job search.

When those measures are taken into account, 6.5 percent of the state's residents were underemployed or gave up looking in December, down from 7.7 percent the year before.

Who's hiring

Thursday's jobs report showed specific industries were largely responsible for the 8,900 jobs the state added in December. Those adding jobs include:

  • Construction added 5,700 new jobs.
  • Education and health services added 2,500.
  • Trade, transportation and utilities added 1,800.
  • Leisure and hospitality added 1,800.
  • Government sector added 200.
  • Logging and mining added 100.
  • Information sector added 100.

Who lost jobs

Industries that lost jobs in December include:

  • Professional and business services lost 1,400.
  • The group "other services" lost 1,100
  • Manufacturing sector lost 600.
  • Financial activities lost 200.