The Minnesota Index, after showing some signs of life during the previous two months, declined 0.1 percent to 138.5 in July. The index inched down as average weekly manufacturing hours dropped, wage and salary employment declined, and the state’s unemployment rate ticked up to 3.4 percent. The U.S. Index increased 0.2 percent in July after a 0.1 percent gain in June.
July’s reading was 0.7 percent higher than a year ago which is the lowest over-the-year gain since February 2010 when the state’s economy was just beginning to pick up from the Great Recession. The U.S. index was up 2.7 percent over the same period. Minnesota’s index has historically averaged 2.7 percent over-the-year compared to the 1.7 percent average through the first seven months of 2019. The state’s labor shortage is most likely restraining Minnesota’s economic growth rate, but the uptick in the state’s unemployment rate from 2.8 percent in October 2018 to 3.4 percent in July 2019 is inconsistent with the notion that employers can’t find anybody to fill their job vacancies.