Jobs, revenue numbers headed in wrong direction
Minnesota lost 4,200 jobs in July, and state government officials revised June’s job numbers downward by 3,600. June’s downgrade is the fifth consecutive downward revision of monthly job numbers by the Department of Employment and Economic Development. Notably, if not surprisingly, much of the job growth over the past year has been in government.
According to the Minneapolis/St. Paul Business Journal, "The state has gained 68,344 jobs since July 2013, led by 21,513 new government positions. The industries with employment declines over the past year were financial activities (down 1,152 jobs), other services (down 860 jobs) and information (down 362 jobs)." And year-to-date, the state "has added a meager 2,900 jobs, or about 400 per month, on an adjusted basis." In other employment news, Cargill will begin cutting 169 jobs in Minnesota next month, as it outsources IT services.
Meanwhile, the latest monthly tax revenue update from Minnesota Management and Budget (MMB) shows that state revenues have once again fallen short of projections. Net general fund revenues for July, which was the first month of fiscal year 2015, were $69 million less than expected. More than half of the shortfall is attributed to lower-than-projected individual income tax revenues.
Blogger Bill Glahn notes on his blog: "So, for those scoring at home, July’s report marked the fifth consecutive… report that came in below forecast (excluding the June report).Five out of six months below forecast does not sound like a state with a booming economy.At some point, all of these monthly shortfalls will add up, and we will be faced with a budget deficit.At present, they are still being dismissed as ‘variations’ that will even out over time."
Posted on Fri, August 15, 2014
by Jonathan Blake filed under