How Close Is Minnesota’s Economy To Full Recovery?
Wednesday, July 28, 2021
April 2021 marked the one-year point from the largest economic downturn in Minnesota’s modern history. The shock to the economy last spring was staggering: Minnesota shed more than 400,000 jobs and lost over $36 billion dollars in GDP output, as in-person activities ground to a halt to slow the spread of COVID-19. To put this in perspective, Minnesota’s 2020 job losses exceeded the size of North Dakota’s entire workforce.
Yet the unique circumstances surrounding this downturn – both the public health crisis that caused the downturn and the massive federal response to keep families and businesses afloat – meant that the path of recovery has had few historical parallels from which to draw. This has involved greater uncertainty about near-term projections and a murkier set of signals to measure economic recovery.
Of particular note is the continued disparity between overall employment levels – which remain well below the pre-pandemic peak – and the apparent surge in labor demand, as measured by job openings and a slurry of anecdotal evidence from employers struggling to find workers.