Minneapolis-St. Paul – Job Losses Rank in the Middle of Midwest Metros
Minneapolis-St. Paul lost 271,100 jobs, or 13.4%, year over year according to the April results from the Bureau of Labor Statistics. This rate of decline ranked 50th of 82 metros, better than some Midwest metros such as Cleveland (-16.8%), Cincinnati (-14.8%) and Detroit (-24.5%); but worse than Chicago (-12.8%), Columbus (-12.7%), Indianapolis (-10.9%), Kansas City (-10.6%) and St. Louis (-11.5%). However, oddly enough, Minneapolis’s unemployment rate “only” climbed to 9.2% which ranked third lowest of all 82 metros and much better than Chicago’s 17.6%. The metro average was 14.4%. Note, however, these numbers are preliminary and subject to change in the next two months.
Looking for additional insights? Explore our interactive COVID-19 map to analyze the potential impact on commercial real estate markets.
Of Minneapolis’s job losses, 38.7% or 104,800 jobs were in the leisure and hospitality sector. This equates to a rate of decline of 56%. The retail sector shed another 22,300 jobs, a decline of 12.1%. Netting out these two concentrated sectors puts the remaining year-over-year rate of job decline at 8.7% which ranked 53rd of 82 metros and close to its Midwest peers. The metro average net decline was 8.2%
Minneapolis-St. Paul’s office sector shed 32,400 jobs year over year, which was a rate of decline of 6.2%. This ranked 38th of 82 metros and was close to the decline in office jobs in Chicago (-6.6%) and most of other Midwest metros. The metro average office year-over-year decline was also 6.6% while the national rate of decline was 7.2%.
Minneapolis also lost 43,700 jobs (-12.7%) in its large education and health services sector. Most of these jobs should return as the economy re-opens and doctors’ and dentists’ offices can start seeing patients again.
To put these jobs in perspective, the Twin Cities’ seasonally adjusted job gain over the last expansion was 301,200 jobs, a growth rate of 17.3%. The recent seasonally adjusted loss of jobs accounted for 91% of the gains in the recent expansion. That is, Minneapolis lost nine jobs in the recent shutdown for every ten added over the previous 10 years. This ratio ranked 44th of 82 metros. For the national average the recent loss represents a decline of 94% of the net gain during the expansion, while the metro average decline was 83% of the net expansion gain.
The good news is that coronavirus cases are on the decline in Minneapolis as of early June, and they had been lower than most Midwest states and metros. Still, the outlook remains mixed: some hospitality, leisure and retail jobs will return when the economy re-opens, but many retail stores and restaurants will struggle to open given social distancing requirements. Moreover, a number of small companies have kept all staff on the payroll because they were incentivized by the Payroll Protection Program. If the PPP program is not renewed in July, many companies face layoffs. Much is uncertain, but most agree that the economy will not improve significantly until the virus is contained.
You may also find our website dedicated to COVID-19 to be helpful during this time. Visit moodys.com/coronavirus for our latest research and views on the credit and economic impact of COVID-19. This site brings together insights from across Moody’s to help you better understand the financial implications of the outbreak