Minnesota's official unemployment rate is a useful indicator of the health of the state’s economy, but it does not tell the whole story. We can get a more complete picture of Minnesota's labor market by looking at alternative measures of unemployment, and by providing the rates by age, gender, and race. The numbers below come from the Current Population Survey.
Use these estimates with caution. The Current Population Survey, which produces these data, has a sample size of only 900 households in Minnesota making it too small to publish monthly estimates for subpopulations. This report uses the BLS unpublished 12-month moving averages. Rolling together 12 months of data is the most reliable method of publishing estimates for subpopulations in Minnesota but means that turning points in the data lag by 6 months. Moreover, even rolling 12 months of data together results in high standard errors on the estimates, reliability issues and limitations on which demographic groups can have labor force estimates published. Essentially, the data provided in this report should be viewed as indicators rather than as reliable estimates.
The Bureau of Labor Statistics has developed alternative definitions of unemployment and underemployment (see Table 1). The official unemployment measure, called U-3, is the share of those aged 16 and over who, at the time of the monthly survey, were not employed in the past week and who looked for work sometime in the past four weeks. U-3 excludes anyone who was not seeking work in the past month (unless they were temporarily unemployed and have a date by which they will return to the same employer). This group, those not seeking work, is considered not in the labor force. Note that the U-3 number reported in this analysis will differ from the official state unemployment estimate because it is based on a 12-month moving average.
In March, the U-3 stood at 3.0%, which is up from 2.6% one year ago. In February 2020, just prior to the pandemic recession, the U-3 rate was 3.0%.
The U-4 adds people who want a job but aren’t actively searching because they think there are no jobs available that fit their qualifications, also known as discouraged workers, to the count. Discouraged workers are those who have looked for work in the past year but stopped looking in the past month because they think they cannot find a job.
In March, U-4 stood at 3.1%, and 2.7% one year ago.
In March, there were 5,400 discouraged workers, which is up from 3,900 one year ago.
U-5 adds all the other “marginally attached” workers, people who looked for work sometime in the past twelve months but, for reasons other than discouragement, did not look in the past four weeks, to the count of unemployed.
In March the U-5 was 3.7% compared to 3.4% one year ago.
The broadest measure of unemployment, U-6, includes all the above and adds people who are employed part-time but want full-time work.
In March, the U-6 was 5.4% in March and 4.9% one year ago. March is down from 5.6% in March 2020 prior to the pandemic.
In March, there were 54,500 involuntary part-time workers, up from 47,100 a year ago. There were 64,200 involuntary part-time workers in February 2020 prior to the pandemic.
Table 1. Alternative Unemployment Rates, Minnesota, 12-month Moving Average
| Measure* | March
2024 |
February
2024 |
March
2023 |
Monthly
Change |
Annual
Change |
|---|---|---|---|---|---|
| U-3 | 3.0% | 3.0% | 2.6% | 0.0% | 0.4% |
| U-4 | 3.1% | 3.1% | 2.7% | 0.0% | 0.4% |
| U-5 | 3.7% | 3.8% | 3.4% | -0.1% | 0.3% |
| U-6 | 5.4% | 5.5% | 4.9% | -0.1% | 0.5% |
| Number of Discouraged Workers | 5,400 | 5,700 | 3,900 | -300 | 1,500 |
| Number of Involuntary Part-Time Workers | 54,500 | 54,100 | 47,100 | 400 | 7,400 |
*Definitions of Measures:
U-3 Official unemployment rate
U-4 Discouraged plus officially unemployed
U-5 All marginally attached (including discouraged) plus officially unemployed
U-6 Involuntary Part Time plus marginally attached, discouraged, and officially unemployed
Involuntary Part time—a component of U-6, including only persons working less than 35 hours per week who want, but cannot find, a full-time job
Long-term unemployment—lasting more than 27 weeks —imposes costs on people that go well beyond lost wages, including lower future earnings.
In March, the number of long-term unemployed stood at 6,600 and was down from 7,100 a year ago. It is lower than in February 2020 when it was at 11,100.
The share of long-term unemployed dropped to 6.8% and was down from 12.1% a year ago.
The median duration of unemployment remained at 7.3 weeks and was down from 8.3 weeks one year ago and down from 7.5 in February 2020.
Table 2. Long-term Unemployment, Minnesota, 12-month Moving Average
| Measure* | March
2024 |
February
2024 |
March
2023 |
Monthly
Change |
Annual
Change |
|---|---|---|---|---|---|
| Number Long-Term | 6,600 | 6,600 | 7,100 | 0 | -500 |
| Share Long-Term | 6.8% | 7.2% | 12.1% | -0.4% | -5.3% |
| Median Duration of Unemployment (weeks) | 7.3 | 7.3 | 8.3 | 0.0 | -1.0 |
*Long term is defined as more than 27 weeks. The share of long term is expressed as a percentage of all unemployed (U-3).
The labor force participation rate for Black Minnesotans was 76.1% in March, which is 5.3 points higher than one year ago and well above labor force participation rate for white Minnesotans. The employment to population ratio was 73.5% in March, up from 69% a year ago. The unemployment rate was 3.3% in March, up 0.8 points from a year ago.
The labor force participation rate for Hispanic Minnesotans was 72.6% in March, down 3.5 points over the year. The employment to population ratio was 69.5% in March, down 3.4 points from one year ago. The unemployment rate was 4.3% in March, the same as last year.
The labor force participation rate for White Minnesotans was 68% in March, up 0.9 points over the year. The employment to population ratio was 66.1%, 0.6 points higher than last year. Unemployment rate was 2.7% in March, up 0.3 points over the year.
The labor force participation rate for Asian Minnesotans was 73.7% in March, up 5.0 points over the year. The employment to population ratio was 72.3%, up 5.8 points compared to last year. Unemployment rate was 1.9% in March, down 1.4 points over the year.
Figures 3, 4 and 5 display labor force participation rates, employment to population ratios and unemployment rates for the total population, Black, Hispanic, Asian, and White Minnesotans for the current months and comparisons to previous months using 12-month moving averages.
Note: Due to the small sample size for Black, Hispanic and Asian workers in the Current Population Survey, the unemployment estimate and unemployment rate are subject to high volatility for these groups. The unemployment rate is valuable and meaningful when examined as a long term trend, not month-by-month.
The labor force participation rate for Native American Minnesotans was 56.8% in 2022 compared to 68.0% for the total population age 16 and older. The employment to population ratio for Native American Minnesotans was 51.8% compared to 65.7% for the total population and the unemployment rate was 8.3% compared to 3.2% for the total population. These are annual estimates from the American Community Survey and are not comparable to the numbers elsewhere in this article.
The labor force participation rate for women ticked up to 65.9% in March, which was up 2.4 points from one year ago. The employment to population ratio rose to 64.0% and was up 1.7 points from one year ago. The unemployment rate remained level at 2.9% in March and was up 1.0 points over the year.
The labor force participation rate for men ticked up to 71.6%, and was 2.4 points higher than one year ago.. The employment to population ratio rose one-tenth of a point to 69.4% and was up 0.3 points from one year ago. The unemployment rate remained at 3.1% in March and was down 0.1 points over the year.
Table 6. Labor Force Indicators by Gender, Minnesota, 12-month Moving Average
| Month/Year | Labor force participation rate | Employment to population ratio | Unemployment rate | |||
|---|---|---|---|---|---|---|
| Female | Male | Female | Male | Female | Male | |
| March 2024 | 65.9% | 71.6% | 64.0% | 69.4% | 2.9% | 3.1% |
| February 2024 | 65.8% | 71.4% | 63.9% | 69.3% | 2.9% | 3.1% |
| March 2023 | 63.5% | 71.4% | 62.3% | 69.1% | 1.9% | 3.2% |
| Monthly change | 0.1 | 0.2 | 0.1 | 0.1 | 0.0 | 0.0 |
| Annual change | 2.4 | 0.2 | 1.7 | 0.3 | 1.0 | -0.1 |
The teen (age 16-19) unemployment rate was 5.2% in March, down 1.5 points over the year, which puts the teen unemployment rate at a record low for a March going back to 2002, the beginning of this series. The labor force participation rate was 64.9% and the employment to population ratio was 61.6%, both at records highs for a March going back to 2002.
Note: Due to the small sample size for teen workers in the Current Population Survey, the unemployment estimate and unemployment rate are subject to high volatility. The unemployment rate is valuable and meaningful when examined as a long term trend, not month-by-month.
