The presence of such industry powerhouses as Polaris, Arctic Cat and New Flyer make Northwest Minnesota a hub of transportation equipment manufacturing.
From wheat and potatoes to soybeans and sugar beets, the region is a major producer and processor of food staples and specialty agricultural products.
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7/19/2023 9:00:00 AM
Anthony Schaffhauser
As detailed in the State of the State issue of Minnesota Economic Trends, in 2022 Northwest Minnesota was within just 1,671 jobs, or less than three-quarters of a percent from our pre-pandemic 2019 employment level. Concurrently, the 2022 Job Vacancy Survey showed a record 20,409 available jobs in the region. One takeaway from those two pieces of data: if all these vacant jobs were filled, Northwest's employment would far exceed pre-pandemic levels.
In my March blog headlined "Youth and Seniors Entered Northwest Minnesota's Workforce in the Pandemic Recovery; Caregivers Exited," I introduced data from the Quarterly Workforce Indicators (QWI), and analyzed Northwest's employment recovery by age and sex. I also asked readers to "Stay tuned for a future blog examining the employment changes of Northwest Minnesota's racial and ethnic groups in the pandemic recovery."
These data show that Northwest's increasingly diverse workforce began to bolster employment in the pandemic recovery when a lack of employees was clearly the constraint. Table 1 shows the most recent employment available by race and ethnicity, which is the beginning of third quarter 2022, compared to the same quarter in 2019, prior to the pandemic.
| Table 1: Employment by Race and Ethnicity | ||||
|---|---|---|---|---|
Northwest Minnesota |
Beginning of 3rd Quarter Employment | |||
| 2019 | 2022 | Change | % Change | |
| White Alone | 211,057 | 203,668 | -7,389 | -3.5% |
| American Indian or Alaska Native Alone | 6,883 | 6,103 | -780 | -11.3% |
| Asian Alone | 2,497 | 2,490 | -7 | -0.3% |
| Black or African American Alone | 3,587 | 3,726 | +139 | +3.9% |
| Native Hawaiian or Other Pacific Islander Alone | 135 | 144 | +9 | +6.7% |
| Two or More Race Groups | 3,488 | 3,642 | +154 | +4.4% |
| Hispanic or Latino | 8,248 | 9,091 | +843 | +10.2% |
| Black, Indigenous, People of Color (BIPOC) | 24,838 | 25,196 | +358 | +1.4% |
| Total, All Races, All Ethnicities | 235,895 | 228,864 | -7,031 | -3.0% |
| Source: Quarterly Workforce Indicators | ||||
Though it is the most recent available, this data is a little outdated. Data from the Quarterly Census of Employment & Wages program shows that we gained a lot of ground since July 2022. QWI shows that we began the third quarter down over 7,000 jobs from 2019. However, looking at more recent QCEW data, we were only down 2,538 jobs comparing the average employment for the entire third quarter 2022 to the same time in 2019. Employment recovery was robust in third quarter 2022, and continued in the fourth quarter as well.
While I am ravenous for more recent data, the trend in the race and ethnicity of jobholders in the region is clear. Whites and American Indians held fewer jobs, the number of jobs held by Asians held steady, and all other groups were up, especially for Hispanic or Latino workers. Furthermore, without BIPOC groups, employment would have been lower by 358 jobs, which is over 20% of 2022's remaining employment shortfall from the pandemic.
It is encouraging that groups with higher unemployment filled the needed jobs to fuel the region's recovery. According to the 2017-2021 U.S. Census American Community Survey (ACS), Black workers had 8.9% unemployment and Hispanic or Latino workers had 10.9% unemployment compared to 4.4% for the labor force overall. If this trend toward more diversity in the workforce sticks, and demographics say it will, we can expect those unemployment rates to decrease as data from future years are incorporated into the ACS results. Ameliorating unemployment for groups that have historically had higher unemployment rates increases the prosperity and quality of life for the entire region.
Notably, the group with the biggest employment decline was American Indians. This is driven by the disproportionate COVID-19 impact on casino gaming in our region. Initially, these operations were all closed due to the pandemic emergency. Even as they began to reopen, many of the big-name music and comedy entertainers that had been booked for events far in advance were not able to be rescheduled. This was drawn out due to uncertainty from emerging variants and waves of infection. Even now this event planning and promotion has a long way to go to catch up. The good news is that other industries have seen significant increases in jobs held by American Indians. First, I must explain some minutia of industry coding to get to that.
Casino gaming is not a specific industry in the North American Industry Classification System (NAICS). Instead, it is placed in one of three NAICS industry sectors: Arts, Entertainment & Recreation, Accommodation & Food Services, or Public Administration. On the surface, this probably seems ridiculous, as one can easily see that gaming is entertainment and recreation. But if the casino adds a big hotel and restaurants, and those parts of the operation come to dominate the operation's employment, then it seems reasonable to place it in Accommodation & Food Services. However, if the casino is managed directly by tribal government and its payroll remains the responsibility of tribal government, employment is counted as Public Administration.
American Indian employment in the three industries that include casino gaming (Arts, Entertainment & Recreation, Accommodation & Food Services, and Public Administration) decreased by 1,479 jobs. Therefore, American Indian employment in all industries except these three increased by 699 jobs. The 1,479 jobs lost in the three gaming industries were counteracted by a 699 gain in other industries to yield the 780 job decline in total. That 699-job increase is over 10% of total American Indian employment in our region in 2019!
Clearly this trend is worth tracking. Once again, I request you stay tuned for a future blog or article. In the meantime, I invite any employers that want to get onto this trend to reach out to James Whirlwind Soldier who is our region's talented Workforce Strategy Consultant, and also check out the Inclusive Workforce Employer (I-We) Program initiated by Rural Minnesota CEP and The Northwest PIC through their Northwest Minnesota Regional Workforce Alliance.
Contact Anthony Schaffhauser at anthony.schaffhauser@state.mn.us.
