Minnesota's official unemployment rate tells us a lot about the share of people in the labor force who have untapped potential to offer. But it doesn't tell the whole story. We can learn more by looking at race, age, and gender, and by looking beyond the traditional unemployment rate. Please note that all data below are presented as 12-month moving averages.
When we break out unemployment rates by race, we find that some communities face greater challenges than others. Black unemployment rose to 12.4 percent in March, its highest level since February 2014. Hispanic unemployment has been falling steadily from an August 2014 level of 8.7 percent and is now 5.1 percent.
Minnesota unemployment rates by race or ethnicity as of March 2015:
Also see the American Community Survey for a broader selection of unemployment data by race or origin, including White, Black or African American, Hispanic or Latino, American Indian and Alaskan Native, Asian, and more. Note that the American Community Survey data are collected and calculated by a method which differs from the Current Population Survey numbers shown above.
We also find differences when we break out rates by age or gender. The unemployment rate for teens has edged upward since January but remains low compared to the past decade. Unemployment rates for women, men, and teens all are lower than 12 months ago.
Minnesota unemployment rates by age and gender as of March 2015:
Long-term unemployment—lasting 27 weeks or more—imposes costs on people that go well beyond lost wages. Future earnings are lower, and health, relationships, and self-esteem can suffer. The number of long-term unemployed following the Great Recession peaked in August 2011 at 75,100 persons and as of March 2015 stood at 28,900 persons, still well above pre-recession levels.
Minnesota long-term unemployment as of March 2015:
It is important to note that the percentage of long-term unemployed persons is a share of unemployed persons only, not a share of the entire labor force.
We can learn still more about Minnesota's labor market by looking at alternative measures of unemployment defined by the U.S. Bureau of Labor Statistics.
Minnesota unemployment rates by alternative measures as of March 2015:
The official unemployment measure, called U-3, is the share of the labor force aged 16 and over who, at the time of the monthly survey, have been unemployed for the past week and have looked for work sometime in the past four weeks.
But what about people who looked for work within the past twelve months but not in the past four weeks because they believed there were no jobs available that fit their qualifications? These marginally attached “discouraged workers” reveal additional untapped potential and are included in a broader measure called U-4.
And what if we add all the other marginally attached workers, people who looked for work sometime in the past twelve months but, for other reasons, did not look in the past four weeks? These other marginally attached workers expand the count still further in the U-5 measure.
And finally, U-6 includes all of the above and adds people who are employed part-time but want full-time work.
Falling unemployment and underemployment mean that Minnesota’s economy is running closer to its full potential than before. By looking at race, age, gender, and additional measures of unemployment, we can see where there is still more work to be done.
Note: Data above are presented as 12-month moving averages. Each monthly data point is an average of that month and the previous 11 months. Twelve-month moving averages are calculated differently than the official estimates of unemployment and should not be compared directly.