The major engines of Minnesota’s economy topped pre-pandemic employment levels in June, a sign the state is on track for recovery and prosperity.
While political leadership often deserves more credit for these kinds of developments than is due, the strategy Minnesota leaders pursued through the pandemic and economic turmoil wasn’t perfect, but it was good.
We can begin the initial bipartisan response to the pandemic, with Democrats and Republicans agreeing that the pandemic poses a catastrophic threat to public health and business success. We needed information and research on the COVID-19 virus, and we got it from Gov. Tim Walz and others who brought together the State’s Health and Medical Brain Trust from the Mayo Clinic, the University of Minnesota, and the private and not-for-profit healthcare providers.
Minnesotans were very well informed about the spread of the virus and the precautions to be taken every day for two years. Only recently has the state moved from daily reporting of virus cases to weekly updates.
Walz and Republicans put together bipartisan plans for priorities for federal pandemic dollars. Both sides reached a historic budget agreement last year. Both agreed to business assistance programs that complemented federal programs and provided a lifeline for many small businesses.
Manufacturing, construction, and professional and business services have now surpassed pre-pandemic employment levels. Leisure, hospitality, retail, and education and health services still have some catching up to do to return to pre-pandemic employment levels.
That’s not surprising. Businesses that still rely on face-to-face contact still suffer from consumer reluctance on everything from dining out to vacationing. Education and health services fall into the same category. These companies need personal contact to be successful.
But all sectors continue to suffer from labor shortages. Minnesota’s total private sector jobs are still 57,000 jobs below pre-pandemic levels. If you add government jobs, the state is 82,000 jobs behind.
Minnesota’s job market is extremely tight with an unemployment rate of just 2%, the second lowest in the country. That rate may have been impacted by an estimated 60,000 Minnesotans retiring during the pandemic.
At the same time, Minnesota has two open positions for every job seeker. Still, Minnesota is expanding jobs at a rate of 1.6% per year, which is higher than the national rate of 1.5% per year.
So the state is on a solid recovery path. And the good news is that a tighter labor market is pushing up wages. Businesses have had to pay more to win back workers who left during the pandemic.
And while two shutdowns in Minnesota during the pandemic certainly hurt, they saved lives. State precautions showed our COVID death rates were well below those of surrounding states, which had loose or almost no restrictions.
Political leadership doesn’t always deserve much credit for economic prosperity, but in the case of mitigating the pandemic’s economic threats, Walz and the sometimes-cooperating Republicans have done well.
— Mankato Free Press, July 22
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