By Tara Bitzan, Executive Director, Alexandria Lakes Area Chamber of Commerce
In April 2021, Minnesota had 181,900 fewer jobs than in January 2020, yet job openings have reached pre-pandemic levels.
After peaking at 11.3% in May 2020, Minnesota’s unemployment rate receded, hitting a low of 4.1% this April. However, the labor force participation rate (people older than 16 working or looking for work) fell 2.5% since January 2020 because some Minnesotans dropped out of the workforce altogether and are not being counted in the official unemployment rate.
The Unemployment Insurance Trust Fund faces a $1.3 billion deficit. Therefore, employers face significant unemployment tax increases to cover that deficit. These are major problems for many Minnesota businesses.
The Alexandria Chamber partnered with the Alexandria Area Economic Development Commission in a recent survey to gather data on workforce issues in Douglas County. Nearly 100 businesses representing a cross-sector of industries including health care, agriculture, construction, finance, hospitality, professional services, retail, manufacturing, human services, education, arts, transportation, and others responded.
Many respondents reported numerous job openings that are taking more than 6 weeks to fill. The majority report that the number of applicants is down and the quality of candidates is lower than before the pandemic. The majority also reported that less than 25% of applicants even followed through with scheduled interviews or accepted job offers.
Employee shortages have caused many of these businesses to cut back on expansion plans or limit services and have negatively impacted their level of quality of output and/or customer service. Nearly 57% percent reported increasing overtime for existing employees and 67% reported spending more time addressing employee burnout. Nearly 80% of respondents blame the labor shortage on expanded unemployment benefits, while others claim lack of housing, childcare and low wages also play significant roles.
The Alexandria Chamber is working closely with the Minnesota Chamber to urge legislators to end the expanded unemployment benefit and to address the trust fund deficit without passing that burden on to employers.
Contact your legislators today about this important issue!
Click here to view a summary of the Douglas County Labor Survey results.