Fact Check: Is Minnesota's job growth outpacing the nation?

Democratic governors like Tim Walz can point to record-low unemployment rates. But is Minnesota's job growth anything special, or does a rising tide in the U.S. labor market lift all boats?

(FOX 9) - Minutes after Minnesota economic development officials released September's jobs data this week — the final numbers before the Nov. 8 election — Gov. Tim Walz was ready to promote them.

"NEW: Our state has hit 12 straight months of job growth *and* continues to have one of the lowest unemployment rates in the nation," Walz said from his official Twitter account.

Walz's office followed up the governor's tweet with a news release that said Minnesota's 2022 job growth "continues to outpace the national rate."

The economy is a top concern in this year's midterms. Inflation has remained stubbornly near a 40-year high, and Republicans are running on a message that President Joe Biden and Democrats have mismanaged the economy. At the same time, Democratic governors like Walz can point to record-low unemployment rates.

But is Minnesota's job growth anything special, or does a rising tide in the U.S. labor market lift all boats?

State economies are closely linked to the U.S. as a whole, making it hard for any governor to have much control over the economy. But that doesn't stop incumbents from claiming credit -- or opponents from criticizing.

Minnesota's job growth

Minnesota employers added 4,200 jobs in September while the unemployment rate ticked up to 2%, which is the lowest rate in the U.S. for the fourth straight month.

The private sector added an estimated 8,500 jobs in September. Education services led the way with 3,200 new hires. Professional and business services added 1,600 jobs, and leisure and hospitality gained 1,400. Government lost 4,300 jobs. Private-sector hiring in Minnesota was slower than the U.S. as a whole for the month.

It's true that Minnesota has added jobs for 12 straight months, according to data from the U.S. Bureau of Labor Statistics.

The last time Minnesota recorded a monthly loss was September 2021. The state had two months earlier this year -- June and August -- where hiring was essentially flat.

That gets us to Walz's claim that Minnesota's year-to-date job growth is outpacing the national rate. This is not the whole story.

Minnesota's pace of gains is 2.4% since January, compared with 2.2% for the country. But that's thanks to strong monthly growth recorded at the start of the year. Minnesota has slightly lagged the U.S. more recently. Since May, Minnesota employment has grown 0.8%, compared with 0.9% for the U.S.

Tight labor market

One reason for that, economists say, is that Minnesota has one of the tightest labor markets in the U.S., with more than three available jobs for every unemployed worker.

There were 192,000 job openings in August, down from 226,000 the previous month, according to the latest data available from the U.S. Bureau of Labor Statistics. Over that time period, Minnesota averaged 60,000 unemployed people.

"It remains a tight labor market and one we think is really full of opportunity right now," Steve Grove, the state's economic development commissioner, told reporters at a Thursday news conference. "It doesn’t seem a lot of employers are giving up on that need to hire in the aggregate."

In September, Minnesota's labor force participation rate ticked down for the third month in a row, to 68.1%, though it remains far higher than the national average. Labor force participation rate is a measure of people working or unemployed and looking for work. It doesn't count people who've retired or are staying home with children.

Inflation continued to outpace average private-sector wage gains in September, though the gap narrowed from previous months. Wages grew an average of 5.7% statewide, while inflation was 7.4% in the Minneapolis-St. Paul metro area -- the only local region tracked by the federal government.