by Luke Greiner
August 2015
The number of jobs added to the economy is often used as the most significant economic indicator, but is job growth always associated with an increase in the labor force? Looking at county level data, we can see this is not always the case. The job and labor force growth relationship is complicated by workers commuting across county and state borders. Labor force data are reported based on where workers live while the most common source of job numbers - the Quarterly Census of Employment and Wage (QCEW) - reports job numbers based on where the jobs are located. Looking at employment growth alone, employment has increased the most between 2004 and 2014 around regional employment hubs like the Twin Cities, St. Cloud, and Mankato and in a few other Greater Minnesota counties like Jackson, Becker, and Pennington. It should be noted that percent growth can be influenced much more easily in counties with fewer jobs, possibly even by a single large business opening or closing.
Labor force growth over the same period has a positive relationship with job growth in many areas but not all. Thirty counties with declining labor force had declining employment, while 33 counties with increasing labor force had increasing employment. Seven counties however experienced labor force growth but saw employment decline (for example Nicollet, Polk, and Ramsey) while 17 counties experienced falling labor force yet saw employment gains (for example Benton, Jackson, and Pope). The map shows employment growth, labor force growth, and the percent change in employment growth minus percent change in labor force growth, from 2004 to 2014. Positive numbers indicate the county employment grew jobs faster than the labor force. Negative numbers indicate labor force growth exceeding job growth over the period.
