Twin Cities no longer the metro area with lowest unemployment
Remember a month ago, when everybody was celebrating the Twin Cities' new ranking as the metro area with the lowest unemployment rate? The state pointed to it as more evidence that the area was coming back strong from the recession. Big networks like CNBC even got in on the act.
Well, only a few weeks later, it looks like we've already lost the title, along with a few jobs. According to BLS data, the area's unemployment rate rose to 4.5 percent in June, and the region is down number two in the nation, with Austin nudging us out by only .1 percent. But don't panic about the new designation: these rankings always tend to shift around, and month-to month numbers don't tell the whole story.
What this doesn't mean is that the Twin Cities are suddenly hurting in any way. Unemployment rates are notoriously fickle, moving up and down from month to month.
Just look at a year ago. In May 2013, we were number one, holding an unemployment rate of 4.7 percent, besting areas like Seattle and Oklahoma City. And yet only a month later, unemployment kicked back up a bit, and just like that, the title was gone.
Just take a look over the past year and a half in the Twin Cities area, and you'll see how quickly things change (data from here):
(Click to enlarge)
As you can see, there's definitely a downward trend there, but it's not straight down. A few months up, a few months, another few months up, etc. It's similar to what we see in the country as a whole. That's why looking at yearly data tends to be better than simply going month by month.
State economist Laura Kalambokidis even talked about this when the numbers came out last month, referring to year-over-year data instead of month by month, saying: "Another part of the story here is that if you look at the year-over-year changes, all of the non-Minneapolis-St. Paul metro regions -- Duluth, Mankato, Rochester and St. Cloud -- have made improvements in the unemployment rate over the year."
What Kalambokidis and other economists were saying a month ago - that the area's startup scene, health care industry and closeness to the North Dakota oil boom have helped revive the economy - is all still true. The state's economy is performing well, and has been for a while now.
But maybe the lesson in all this is to not celebrate quite so much when Minnesota comes out number one. Instead, just know that the Twin Cities are doing better than much of the country. And when the next numbers come in on August 27th, take them with a grain of salt.