Each month the GREATER MSP intel team tracks economic indicators for the MSP region and publishes the MSP Economic Pulse to share across the Partnership. Included in the Pulse are monthly results of the Census Bureau’s household survey, which produces labor force characteristics, and the employer survey, which produces employment and payroll characteristics. We also publish monthly job postings trends, sourced from a third-party data provider that scrapes job postings sites across the web to produce a monthly count of unique job postings. Since April, the Pulse has been an increasingly important resource for tracking the economic health of the region because it provides nearly real-time economic conditions on the regional economy. We have learned through the last several months of economic upheaval that real-time data on economic activity is critical to our shared understanding of the social and economic impact of the COVID-19 pandemic. Real-time data is also critical to our ability to make smart decisions about focusing recovery strategies on our region’s greatest challenges. In the coming weeks, we will be sharing more information about a new intelligence tool to track real-time, high-frequency metrics to establish that shared understanding of our region’s health during recovery. In addition to the monthly MSP Economic Pulse, the new tool will provide a new, much-needed picture of our regional recovery and important inputs to the development of an updated regional recovery strategy. Stay tuned!
In the meantime, let’s break down some of the key findings from the latest MSP Economic Pulse from July 2020. We learned that the Greater MSP region’s total nonfarm employment continued to see growth from June to July, though more slowly this month from the previous two months. July’s nonfarm employment increased from June by 7,473 to nearly 1.87 million. Total nonfarm employment is still 8.7% below employment levels the same month last year, so we have a way to go to get regional employment back to levels we are used to.
The Leisure and Hospitality sector, which includes arts, entertainment, accommodations, and food service, has been hit hard by the COVID-19 pandemic the last few months. From March to April, when the state stay-at-home orders led to the closure of sit-in restaurants, museums, and performance halls, and the halt of travel, employment in this industry sector dropped over 50% from about 178,000 to about 84,000. Since April, employment has steadily increased back up to nearly 150,000, but there are still 28,000 fewer jobs in July than in March and still about 26% below employment in July 2019. What concerns us about the Leisure and Hospitality sector is that there is a large concentration of employment for Black, Indigenous, and People of Color (BIPOC) workers and jobs are predominately low wage (the state-level average wage is only $17.18). While we are seeing jobs returning as businesses reopen, there is concern that the disproportionately high level of unemployment for BIPOC low-wage workers will further exacerbate racial inequities in the region.
July saw an improvement to the unemployment rate for the region, improving from 9.2% in June to 8.2% in July. The unemployment rate represents the portion of people who are not working, but actively seeking work. The number of people who are unemployed decreased by about 22,000 from June to July while people who are employed increased by about 4,400. The total labor force is 2,029,218, a slight drop from June. If unemployed people stop looking for work, they are no longer counted as part of the labor force. This is important because there is concern that people who lost their jobs due to the COVID-19 pandemic may become discouraged from seeking employment and decide to stop altogether. There is also concern that people are being forced to leave the labor force to care for school-aged children who are at home during distance learning or because childcare centers have closed. As we continue to track labor force dynamics over the coming months we will be paying attention to ensure that both the number of people who are unemployed is decreasing and the total size of the labor force is increasing to ensure that people aren’t dropping out of the labor force.
Check out the July 2020 MSP Economic Pulse for full coverage of the latest monthly economic indicators for the region, including a peer region comparison of unemployment, wage trends, and job posting activity. Stay tuned for more details about a new tool to gauge our region’s economic health and the pace of recovery using new sources of real-time data. Ensuring a swift and inclusive recovery will require focused strategies on the greatest threats to our regional economy and we are laser-focused on ensuring we have the best data to get us there!