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Minnesota's Job Vacancy Survey asks employers to report their plans to maintain or change current employment levels over the six months following fourth quarter 2021. Of employers surveyed that responded:
A diffusion index over 50 percent indicates that employers plan to add employment overall, while a diffusion index under 50 percent indicates employers plan to decrease employment. At 66.5%, the diffusion index indicates that overall employers plan to add jobs over the next 6 months, up 8 points from one year ago.
The Twin Cities index was 70.6% and the Greater Minnesota index is 61.8%, meaning that employers anticipate employment increases across the state. Moreover, all regions have an index score well above 50 percent, with the most optimism shown in the Twin Cities and Northeast Minnesota, which were the two regions hit hardest during the pandemic recession.
Table 1: Future Hiring by Region, Fourth Quarter 2021
| Area | Increase Employment | Employment Constant | Decrease Employment | Diffusion Index |
|---|---|---|---|---|
| Minnesota | 39.5% | 54.0% | 6.5% | 66.5% |
| Greater Minnesota | 36.3% | 51.0% | 12.7% | 61.8% |
| Twin Cities | 42.3% | 56.5% | 1.2% | 70.6% |
| Region 1 - Central | 46.1% | 45.5% | 8.4% | 68.9% |
| Region 2 - Northeast | 31.5% | 63.4% | 5.1% | 63.2% |
| Region 3 - Northwest | 31.3% | 48.6% | 20.1% | 55.6% |
| Region 4 - Southeast | 47.8% | 38.7% | 13.6% | 67.1% |
| Region 5 - Southwest | 23.4% | 64.6% | 12.0% | 55.7% |
| Region 6 - Twin Cities | 42.3% | 56.5% | 1.2% | 70.6% |
Table 1 shows employer hiring plans by region.1 These can be translated into a diffusion index as in Figure 1.
Table 2 below provides a breakdown of employer hiring expectations by industry while Figure 2 is a graph of the diffusion index of future employment expansion or contraction by industry. As employment bounces back, employers in the following industries are the most optimistic about adding jobs during the next six months: Accommodation & Food Services, Other Services, Retail Trade, Manufacturing, Healthcare and Construction.
All but two industries in the state has a diffusion index above 50 percent, meaning they anticipate an increase in their employment levels in the next six months. The two industries with a diffusion index less than 50% are Management of Companies (48.4%) and Agriculture (47.0%) meaning that they anticipate contracting over the next 6 months. The other three industries with the lowest positive diffusion index are Utilities and Mining, which are both at 54.5%, and Professional, Scientific and Technical Services, which is at 55.1%.
Table 2. Future Hiring by Industries in Minnesota, Fourth Quarter 2021
| Industry | Increase Employment | Employment Constant | Decrease Employment | Diffusion Index |
|---|---|---|---|---|
| Agriculture, Forestry, Fishing & Hunting | 10.8% | 72.5% | 16.8% | 47.0% |
| Mining | 28.7% | 51.6% | 19.7% | 54.5% |
| Utilities | 19.6% | 69.7% | 10.7% | 54.5% |
| Construction | 43.6% | 45.4% | 11.0% | 66.3% |
| Manufacturing | 43.5% | 53.8% | 2.8% | 70.3% |
| Wholesale Trade | 28.5% | 64.1% | 7.5% | 60.5% |
| Retail Trade | 51.6% | 38.5% | 10.0% | 70.8% |
| Transportation & Warehousing | 31.4% | 62.7% | 5.9% | 62.8% |
| Information | 24.1% | 65.5% | 10.4% | 56.9% |
| Finance & Insurance | 38.5% | 51.1% | 10.4% | 64.0% |
| Real Estate | 33.9% | 58.1% | 8.0% | 63.0% |
| Professional, Scientific & Technical Svcs. | 13.3% | 83.6% | 3.1% | 55.1% |
| Management | 0.0% | 96.8% | 3.2% | 48.4% |
| Administrative Support & Waste Management | 32.2% | 58.0% | 9.8% | 61.2% |
| Educational Services | 21.2% | 75.0% | 3.8% | 58.7% |
| Health Care & Social Assistance | 43.0% | 54.1% | 2.9% | 70.0% |
| Arts, Entertainment & Recreation | 25.3% | 64.9% | 9.8% | 57.7% |
| Accommodation & Food Services | 62.4% | 35.4% | 2.3% | 80.0% |
| Other Services | 61.7% | 35.1% | 3.2% | 79.3% |
| Public Administration | 25.6% | 64.4% | 10.1% | 57.7% |
Figure 3 graphs the diffusion index of future employment expansion or contraction by industry in Greater Minnesota and the Twin Cities Metro Area.
The following table presents hiring expectations by firm size for Minnesota, Greater Minnesota and the Twin Cities. During the six month period following fourth quarter 2021, large and medium size employers are most likely to anticipate an increase in their workforce while very small employers are least likely to anticipate an increase in their workforce.
Table 3. Future Hiring by Firm Size, Fourth Quarter 2021
| Area | Increase Employment | Employment Constant | Decrease Employment | Diffusion Index |
|---|---|---|---|---|
| Minnesota | ||||
| Very Small | 34.2% | 59.1% | 6.7% | 63.7% |
| Small | 48.6% | 45.2% | 6.2% | 71.2% |
| Medium | 60.7% | 34.6% | 4.7% | 78.0% |
| Large | 62.4% | 31.3% | 6.3% | 78.1% |
| Greater Minnesota | ||||
| Very Small | 31.8% | 54.1% | 14.1% | 58.8% |
| Small | 45.0% | 45.7% | 9.4% | 67.8% |
| Medium | 58.6% | 33.1% | 8.4% | 75.1% |
| Large | 52.4% | 38.3% | 9.3% | 71.5% |
| Twin Cities Metro | ||||
| Very Small | 36.4% | 63.6% | 0.0% | 68.2% |
| Small | 51.4% | 44.9% | 3.7% | 73.9% |
| Medium | 61.9% | 35.5% | 2.6% | 79.7% |
| Large | 68.1% | 27.3% | 4.6% | 81.7% |
1The diffusion index is constructed so that if all firms report that they expected to expand, the index would equal 100. If all report that they expect to contract, the index would be zero. If the percentage of firms that expect to expand just equaled the percentage of firms that expect to contract (regardless of the percentage expecting to remain constant), the index would equal 50. Thus, a value of 50 represents the threshold between expectations of contraction and expansion.
