Minnesota’s labor market defied expectations in August, adding thousands of jobs and outpacing the country as a whole just a month after state officials warned of an economic slowdown.
Employers added 5,900 jobs in August, the state Department of Employment and Economic Development (DEED) reported Thursday. In addition, a routine revision to the July numbers showed the state lost just 500 jobs that month, less than the 4,400 first reported.
“Minnesota’s labor market had a strong month in August, adding thousands of jobs and people looking for work,” DEED Commissioner Matt Varilek said in a statement Thursday. “We continue to monitor our economy for signs that federal disruptions are affecting Minnesota employers. But in August, we outpaced national trends.”
DEED had sounded the alarm a month ago that tariffs, federal funding cuts, mass government layoffs and an immigration crackdown were beginning to strain Minnesota’s economy as well as the country’s at large.
The U.S. unemployment rate ticked up to 4.3% in August, and employers have added fewer than 30,000 jobs a month for the past three months. Some of that decline is because the American workforce is shrinking, Fed Chair Jerome Powell said Wednesday, citing declining immigration and lower labor force participation overall.
Still, he said, employers aren’t hiring enough to keep unemployment from rising, and though wage growth is outpacing inflation, it’s also starting to drag.
“Overall, the marked slowing in both the supply of and demand for workers is unusual,” Powell said. “In this less dynamic and somewhat softer labor market, the downside risks to employment appear to have risen.”