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Unemployment claims rise in Minnesota

(The Center Square) – Minnesota had the sixth lowest decrease in unemployment claims since last week, WalletHub reported Thursday.

Across the country, new unemployment claims decreased 7.3% week-over-week March 27 amid high inflation and threat of a recession, the report said.

Minnesotans didn’t experience that relief, however. With 130 per 100,000 people in the labor force, the state had the 13th most claims per capita, according to the report. The state’s s unemployment claims increased 13.31% from the week of March 20 to the week of March 27, giving it the fourth smallest decrease among the states. The state’s unemployment claims were 29.83% higher in the week of March 27 compared with the week of March 25, 2019. Unemployment insurance initial claims were 24.94% higher in the week of March 27 compared with the week of March 28, 2022.

Rutgers, The State University of New Jersey, economics professor Jennifer Hunt said in the report that it’s essential for people to save if possible so that if unemployment occurs, there’s money to fall back on. When a recession seems imminent, it’s wise to only change jobs if the new job is in a larger firm or a less cyclical industry than the current job.

“Obtaining additional education or credentials significantly reduces the likelihood of unemployment, and makes saving easier by increasing earnings,” she said.

People with financial assets can hedge against inflation by buying the U.S. Treasury’s Inflation Protected Securities bonds, Hunt said.

“In the long run, bonds have a lower real return than stocks, however, so they should be only one component of an investment portfolio for those investing for the long term,” she said. “So far in this period of high inflation, TIPS have not outperformed the regular U.S. Treasury bonds, but are likely to do so if inflation persists.”

She said she’s becoming more optimistic regarding a recession because unemployment’s steady and inflation’s starting to fall.

WalletHub Analyst Jill Gonzalez said in a statement that construction jobs have very high unemployment numbers currently due to building activity slowdown, since higher interest rates are lowering demand for new individual housing.

“Farming, fishing, and forestry jobs are also seeing high unemployment, which has more to do with technological advances and less about the current economy or pandemic recovery,” she said.

She said the nation can expect unemployment to increase through the end of the year, even though the Fed raised rates by a quarter of a point in the smallest increase since March 2022.

“Unemployment will still need to rise, at least slightly, to get inflation numbers down to where the Fed wants them,” she said.

Overall, red states’ unemployment claims last week decreased more compared with blue states’. States are judged blue or red based on 2020 presidential election votes. Blue states’ average rank for biggest decreases in unemployment claims last week was 24, while red states’ average rank was 28.

Kentucky experienced the greatest decrease in initial claims filed last week (down 73.42%), while Indiana experienced the least decrease (365.29% increase).

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