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Minnesota's employment picture is improving
by Bill Catlin, Minnesota Public Radio
November 18, 2003

Lance Fensterman, general manager of Bound to be Read bookstore in St. Paul, is cautious about hiring holiday staff because consumers are hesitant about buying. "We're up a fair amount from last year, but that's like comparing apples to rotten apples," he says. (MPR Photo/Bill Catlin)

Minnesota's economy added 8,500 jobs in October -- the biggest gain since February, 2000. The state's jobless rate held steady at 4.6 percent, as layoffs continue at a high rate, and as more people enter the workforce to begin a job search. Even so, state officials calls the job gains impressive.

St. Paul, Minn. — The jobless recovery may finally be over. Minnesota's economy has regained 16,000 jobs since bottoming out last June. At that point, the state had lost 64,000 jobs since the start of the recession.

Steve Hine, director of research with the Minnesota Department of Employment and Economic Development,says Minnesota has regained jobs at a faster rate than the nation as a whole.

"e've regained one-ourth of the jobs we lost during the recession in four months. At the same time, the nation has regained just over one-tenth of the jobs," says Hine. "So we do seem to have turned the corner by this overall employment measure, and the state does appear to have turned the corner at a quicker pace than the nation."

This is a strong sign that firms are finally confident enough in the upturn to start spending, and they're even spending now on new employees. - Steve Hine, Department of Employment and Economic Development

Hine says some of the strongest performances have come in computer and electronic manufacturing, temporary employment agencies, and computer systems design. He says those industries are closely linked to business spending -- the missing ingredient that many economists contend held back job growth.

"This is a strong sign that firms are finally confident enough in the upturn to start spending, and they're even spending now on new employees," says Hine.

The leisure and hospitality industry posted an all-time employment high, largely on the strength of hiring at bars and restaurants.

On St. Paul's Grand Ave., preparations are underway for a new Axel's Bonfire restaurant slated to open in mid-December. Operations manager Ray Burrows is sitting at the back of a walk-in cooler, that's temporarily in use as a human resources office. A few feet away, job candidates are filling out forms and discussing job possibilities.

"Approximately 160 people will be hired. The Ciatti's that were going into right now -- the old Ciatti's -- looked at probably about 65 to 70 employees," says Burrows. "We've actually been hiring for about a week, have had about 600 applicants, and I'd say were probably about 80 percent done."

Axels' Bonfire stands in stark contrast to the slew of Twin Cities restaurants that have closed in recent months. Tom Day, a spokesman for Hospitality Minnesota, says the job numbers are an indication that a very hard-hit industry is starting to bounce back.

"This summer we're starting to see more and more confidence. It's still very inconsistent. So you may do really great on one week, and the following week have a terrible week. So there's no rhyme or reason to it yet, but it is starting to grow more consistent," says Day.

	Now hiring

Hiring in the retail industry is slower than usual for the pre-holiday season, particularly in department stores and food and beverage stores. The trade, transportation and utilities industry was the only sector to show declining employment in October. But caution can be found beyond department and grocery stores.

"We're up a fair amount from last year, but that's like comparing apples to rotten apples," says Lance Fensterman, general manager of Bound to be Read bookstore in St. Paul.

Fensterman says he's added only one full-time equivalent position for the holidays. He says his caution reflects tight margins, and a certain amount of consumer hesitation about buying.

"People are more optimistic. But just the way you see hiring of a lot of temporary workers, I think that people's optimism is also sort of shaky," says Fensterman.

Perhaps with some justification. The state's jobless rate didn't budge from last month's reading of 4.6 percent. Steve Hine of the Minnesota Department of Employment and Economic Development says ongoing layoffs and the duration of unemployment remain serious problems.

"Although we may be turning the corner, we're still well below where we would normally be at this stage of a recovery," he says.

Hine says at the current rate of job growth, it will take another year to reach job numbers last seen before the recession.

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