Industrial Analysis

by Jerry Brown
March 2013

Monthly analysis is based on seasonally adjusted employment data.
Yearly analysis is based on unadjusted employment data. *

Overview

Employment estimates produced a seventh consecutive monthly gain with the February employment gain measuring 14,500. Minnesota has added 59,500 jobs since July. Seven of the 11 supersectors showed employment growth for the month. The largest increases came in Professional and Business Services with a gain of 6,800 and Leisure and Hospitality with a gain of 3,200. An additional four supersectors showed gains from 1,300 to 1,900. The only large loss was in Government with a decline of 1,000. Another strong monthly gain pushed the annual rate of growth to 2.3 percent, equal to 62,400. Every supersector showed over-the-year employment gains. The three largest annual changes came in Trade, Transportation, and Utilities, up 15,200, Educational and Health Services, up 13,100, and Professional and Business Services, up 12,300. Government added 5,300, and Manufacturing, Financial Activities, and Leisure and Hospitality all showed gains in excess of 3,000 for the year.

Mining and Logging

Employment increased by 100 for the month. Employment showed an increase of 300 on an annual basis.

Construction

Employment in Construction increased 1,400 for the month and followed a gain of 2,500 in January. This fast start to 2013 comes after a very lackluster showing in the second half of 2012 during which time 1,900 jobs were lost. January and February have reversed those losses and have added an additional 2,000 jobs as well. Most of the monthly growth came in Specialty Trade Contractors. Over the last year the supersector added 1,900 jobs, with more than 1,000 of this gain coming from Specialty Trade Contractors. Construction of Buildings and Heavy and Civil Engineering Construction also showed growth of 400 and 500 respectively. Housing starts for Minnesota for February were slightly lower than for one year ago, but the mix of units was very different. Nearly all of the permitted units in February 2013 were single unit permits while in February 2012 more than half of permits were for units in multifamily structures.

Manufacturing

Manufacturing saw a loss of 800 jobs in February marking the first decline since last October. There was a loss of 400 in both Durable and Nondurable Goods Manufacturing. The losses were very modest in both major components with losses in Food Manufacturing and Fabricated Metal Manufacturing. Compared to February 2012, Manufacturing employment increased by 1.1 percent or 3,400 jobs. Durable Goods Manufacturing produced most of this increase with a gain of 2,800. Nondurable Goods Manufacturing added 500 driven by a gain of 1,200 in Food Manufacturing. Advance estimates of manufacturing shipments, inventories, and orders showed relatively poor results in that orders, shipments, and unfilled orders were all negative for the month but in each case followed four months of growth.

Trade, Transportation, and Utilities

Estimates for February showed an increase of 1,300 over the past month for Trade, Transportation, and Utilities. This was the seventh straight month of employment growth with a net increase of 13,900 jobs during this time. This record of growth has been largely from growth in Retail Trade which added 8.600 jobs in the last seven months and 2,300 in February alone. Wholesale Trade showed a loss of 700 for the month marking the first loss since August during which time there has been a net increase of 2,800. The pattern in Transportation, Warehousing, and Utilities was similar to Wholesale Trade with a loss of 300 in February following several months of growth. Since September the sector has added a net 2,800 jobs. On an annual basis the supersector showed a gain of 15,200 jobs, equal to 3.1 percent growth. The largest number of new jobs came in Retail Trade which added 7,700 jobs. Wholesale Trade was up nearly 4,800 over the year with Durable Goods Wholesaling showing strong growth. Transportation and Warehousing also added 2,700 jobs.

Information

Information showed a loss of 100 over the past month. This followed four consecutive months of growth which netted 1,400 during those months. Over the past year the supersector added 2,200 jobs with all of the growth coming outside of traditional Publishing and Telecommunications.

Financial Activities

Monthly estimates showed job growth of 1,700 in February, which was the largest increase since April 2012. Most of the gain was in Finance and Insurance which added 1,200 with small gains in most components but particularly at securities firms. Real Estate and Rental and Leasing showed a gain of 500. Supersector employment was up 3,600 compared to one year ago with most of this coming in Finance and Insurance.

Professional and Business Services

By far the largest monthly gain was in Professional and Business Services with a gain of 6,800. This was the fourth consecutive monthly increase for the supersector after a fairly weak period from summer through early fall 2012. All three of the major component industries showed growth, but the largest gain was in Administrative and Support with a gain of 5,000. The gain in Administrative and Support follows a gain of 1,800 last month and helps to erase a net loss of 3,900 that occurred during a weak period from May to December 2012. Compared to last year the supersector showed a gain of 12,300 with a good distribution of growth across the major industry components. Professional, Scientific, and Technical Services showed a gain of 5,400, followed by Administrative and Support, up 4,700, and Management of Companies, up 2,200.

Educational and Health Services

Educational and Health Services saw a fourth consecutive month of growth adding 1,900. Private Education added 1,100, and Health Care and Social Assistance added 800. Health Care and Social Assistance has not shown a monthly loss since July 2011. Educational and Health Services added the greatest number of new jobs with a gain of 13,100. All of the annual growth came in Health Care and Social Assistance. Ambulatory Health Care added 7,900, well above the next largest gain in Nursing and Residential Care.

Leisure and Hospitality

Monthly estimates showed a fifth consecutive monthly gain in Leisure and Hospitality with a net gain of 8,300 over the five months. For the month the supersector added 3,200 jobs with 2,200 of the gain coming in Accommodation and Food Services, particularly in Full Service Restaurants. On an annual basis Leisure and Hospitality showed a gain of 3,300 with the majority of the increase coming in Limited Service Eating Places.

Other Services

There was no change in the level of employment over the past month. Over the past year the supersector showed a gain of 1,900 with most of the increase coming in Religious, Grantmaking, Civic, Professional, and Other Similar Organizations.

Government

A loss of 1,100 in Local Government was the cause of the decline in total government. Local Government has shown a loss in three of the last four months. Compared to last year Government added 5,300 jobs. Local Government contributed most of the gain adding 4,400 with 2,800 of this from Local Government excluding Education. State Government added 1,300, all from State Government Education.

Seasonal Adjusted Nonfarm Employment

February
2013

January
2013

December
2012

Total Nonfarm

2,779.9

2,765.4

2,751.9

Goods-Producing

410.8

410.1

406.9

Mining and Logging

7.3

7.2

;7.1

Construction

96.4

95.0

92.5

Manufacturing

307.1

307.9

307.3

Service-Providing

2,369.1

2,355.3

2,345.0

Trade, Transportation, and Utilities

515.8

514.5

510.0

Information

54.7

54.8

54.6

Financial Activities

179.5

177.8

177.8

Professional and Business Services

345.7

338.9

337.9

Educational and Health Services

488.8

486.9

486.6

Leisure and Hospitality

252.0

248.8

246.9

Other Services

116.9

116.9

115.8

Government

415.7

416.7

415.4

Source: Department of Employment and Economic Development,
Current Employment Statistics, 2013.


Chart: MN Employment Growth


* Over-the-year data are not seasonally adjusted because of small changes in seasonal adjustment factors from year to year. Also, there is no seasonality in over-the-year changes.