Census survey data: Minn. economy stabilizing

After several years of recessionary declines, Minnesota's economy began to stabilize last year, according to new survey data released Thursday by the U.S. Census Bureau.

For the first time since 2007, the American Community Survey showed no decline in median household income, and the poverty rate remained flat at just under 12 percent in 2011.

"After several years of negative trends in income, in poverty, in labor force participation, we've seen a leveling off of a lot of these indicators, so that's good news," state demographer Susan Brower said.

Moreover, Minnesota showed signs of stabilizing while many other states showed worsening economic conditions in 2011, she said.

"Minnesota appears to be in the top tier of states in a lot of these indicators. Many states have seen continued declines in income and increases in the poverty rate, and Minnesota has leveled off," Brower said.

Median household income was just under $57,000, as it was in 2010. The unemployment rate improved, and the percentage of people in the state's labor force held steady. During the recession, some workers became discouraged and stopped looking for jobs.

The survey data released Thursday mirror what state labor analysts have seen. Minnesota's unemployment rate has recovered much faster than in most states. Minnesota also continues to have among the highest labor force participation rates, said Steve Hine, the state's chief labor market analyst.

Still, the labor force participation rate was around 70 percent in 2011 compared to about 75 percent a decade ago. Hine said some of that decline can be attributed to an aging population and might be here to stay.

RECOVERY IN PROGRESS

Although the survey data show some economic indicators are leveling off, Hine said Minnesota's economic recovery still has a ways to go.

"It continues to be a fragile recovery," he said. "In that environment, it wouldn't take much to tilt the balance in the other direction, and there's certainly looming threats of that kind of possibility."

That includes the so-called "fiscal cliff" the U.S. government faces at the end of the year if Congress doesn't act. Failure to reach a budget agreement would trigger automatic cuts in every aspect of the federal budget. There are also concerns that situations in the Middle East, Europe and China could negatively impact the U.S. economy.

"In a fragile recovery like we have been experiencing, those threats have to be considered more significant," Hine said.

And the recovery has yet to reach thousands of Minnesotans who are still without work. Inside a classroom at the Minnesota WorkForce Center in South Minneapolis on Wednesday, a group of unemployed workers who have received extended unemployment benefits for at least eight or nine months took turns getting tips on their plans to find a job.

That included Tim Topitzhofer, who said he's always been a job-chaser, willing to pursue short-term contracts all over the country. He most recently worked on disaster sites as a housing inspector with the Federal Emergency Management Agency. But Topitzhofer said over the past four or five years, the economic slowdown has dried up his opportunities for work.

"I've been kind of in this intermittent work force for most of my life, and it's a lot harder to pick up employment and fill in the gaps now — way more so," he said. "I really appreciate these federal [unemployment benefit] extensions. I think they're very necessary until things get better."

Just outside the classroom, Monique Bourgerie sat at a computer station and scrolled through job ads on Craigslist. Bourgerie has a background in occupational therapy, but she hasn't been able to find work in her field. So she makes ends meet by cleaning houses and working for caterers — jobs that are touch and go.

Bourgerie, 49, said her financial situation hasn't improved over the past few years.

"I would have imagined it to be better, though, and it's not. And that's kind of the sad thing, especially at my age, I feel like I'm not getting anywhere," she said. "But that's just because it's the way things are. The hardest thing to accept is that I feel kind of powerless over this situation."

HOW MINNESOTA FARES

The American Community Survey is an ongoing survey that compiles information from 3.5 million households each year. Besides economic data, the survey asks residents questions on topics including housing, language and transportation.

The one-year estimates released Thursday only cover population areas larger than 65,000 people, so officials in Minnesota's smaller counties and cities will wait until later this fall for data that combine three or five years of data.

In Minnesota's largest counties and cities, the survey showed a similar economic trend to what the state experienced in 2011.

"Between 2010 and 2011, things have pretty much stabilized," said Todd Graham, demographer for the Metropolitan Council.

Graham said it's useful to compare data from the Twin Cities area to other metro areas around the country. The Twin Cities still has a leg up on many metro areas across the country, according to the new data, he said.

"We have some great advantages in income and poverty rates. We have third-lowest poverty rate among the major metro areas and we have the sixth-highest income among the major metro areas in the country," Graham said. "Those rankings have been pretty stable, and it's, I think, good news to find that compared to other metro areas, things are pretty good here."

Graham acknowledged that policy makers remain concerned about certain economic indicators. For example, about a third of households in the metro area report that they're spending a substantial part of their income on housing. Still, the Twin Cities ranks fourth in housing affordability among major metro areas, he said.

Only three counties in greater Minnesota were included in the 2011 data: Olmsted, St. Louis and Stearns. Survey data showed no significant changes in median household income and poverty rate from 2010 to 2011 in those counties.

Health care and technology have helped the Rochester area maintain its economic competitiveness through the recession, according to Olmsted County Administrator Richard Devlin.

"Olmsted County was pretty stable through the recession," Devlin said. "We've been very fortunate here."

MPR reporter Elizabeth Baier contributed to this report.

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