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Northland's jobless rate is lowest since 2007

(Gary Meader /

Unemployment rates in Duluth and throughout much of Northeastern Minnesota have reached their lowest levels since before the recession.

Duluth's jobless rate slid to 4.7 percent in October, while the greater Twin Ports area dropped to 5.2 percent. Meanwhile, all of Northeastern Minnesota declined to 5.3 percent, recent Minnesota Department of

Employment and Economic Development data show.

The rates haven't been this low since November 2007.

"It means we have recovered all the lost ground from the recession," said Tony Barrett, an economics professor at the College of St. Scholastica. "We are where we were five or six years ago, with the added caveat that incomes have not gone up much depending on the type of job you have. Incomes have been flat for most people."

So we've recovered from the recession, but we don't have much to show for the past five or six years, he said.

Still, there's reason to celebrate, right?

"It's how do you want to look at it," Barrett said. "If you're a pessimist, we're no better off. If you're an optimist, we've come far from 2008 and 2009."

The September and October local unemployment rates show some departures from the rest of the region.

Virginia's drop to low levels was especially dramatic. It reached 5.4 percent in October, its lowest point in eight years and down from a high of 17.2 percent in the summer of 2009.

"Mining is coming back in a strong way, and I think Virginia is benefiting from that," said Jan Saxhaug, DEED's labor market analyst for the region.

Koochiching County has fared worse than others, with its jobless rate rising from 7.1 percent in September to 7.7 in October, as major layoffs at the Boise paper mill in International Falls began to take effect.

A closer look at the region's other numbers, however, reveals other areas of concern.

"If you look at jobs before the recession, there were more in the manufacturing sector, for example," Saxhaug said. "A lot of those were good-paying jobs with benefits. Many of those jobs went away with the recession, and they are not necessarily those that came back."

Many of the new jobs are in the service sector, in food prep and office and administrative support, which don't pay as well, he said.

And while unemployment rates rival those in late 2007, the labor force -- defined as those working and actively looking for work -- is smaller today and fewer people have jobs.

"That's a problem," Saxhaug said. "Fewer people unemployed is a great thing. But when you have a declining labor force, it can mask other problems. There are other things going on. A declining labor force will lead to a declining unemployment rate."

Contributing to the smaller workforce are aging and retiring baby boomers and discouraged workers who have given up the job search entirely, both Saxhaug and Barrett say.

"There are people who have left because times are tough," Barrett said. "They're forced to retire early. They've collected their pension, and they're probably not coming back."

"If it's not like 2007," Barrett said of all the jobs numbers, "that's telling me we have not totally recovered yet."