California unemployment sitting at new (NSA) cycle high of 5.8% and we're heading into winter, when more claims and layoffs typically occur… #MacroEdge pic.twitter.com/E7uxC8NHYP
— Don Johnson (@DonMiami3) August 25, 2024
As we approach the winter months, the economic climates in California and Minnesota are becoming increasingly precarious, each revealing its own set of challenges that could complicate the road ahead.
In California, unemployment has surged to a new cycle high of 5.8% (not seasonally adjusted), raising concerns as the state braces for the typical increase in claims and layoffs associated with the winter season. This alarming trend reflects broader uncertainties in a labor market that has already faced significant challenges in recent years.
Meanwhile, Minnesota is experiencing its own economic difficulties. The state’s unemployment rate rose to 3.2% in July, with the Minneapolis Fed noting a sharp decline in manufacturing activity during May and June. Several prominent manufacturers, including BRP Marine, Rich Products, Hutchinson Manufacturing, and Medtronic, have announced layoffs, signaling a troubling contraction in this critical sector.
Minnesota's unemployment rate rose to 3.2% in July. The Minneapolis Fed mentioned manufacturing activity ‘decreased briskly’ in May and June.
Several manufacturers have announced layoffs in Minnesota including BRP Marine, Rich Products, Hutchinson Manufacturing, Medtronic, and… pic.twitter.com/5urPtzljLR
— Warn Tracker 2.0 (@j77324) August 25, 2024
The agricultural landscape in Minnesota paints a similarly bleak picture. Farmers are expected to see lower incomes this year, a decline that not only dampens farmer sentiment but also negatively impacts agricultural equipment manufacturers like John Deere and Titan Machinery. As farmers struggle to maintain profitability, the ripple effects are felt throughout the entire supply chain.
Compounding these issues, Minnesota’s tourism sector has failed to meet expectations in 2024, contributing to the overall economic malaise. A spike in initial claims for unemployment benefits in July further underscores the mounting pressures faced by the state’s workforce.
Both California and Minnesota are confronting significant economic hurdles as winter approaches. With rising unemployment, layoffs in manufacturing, and diminished agricultural income, the outlook for both states is fraught with uncertainty.
Sources:
https://www.twincities.com/2024/08/15/minnesota-jobs-data-flat-in-july-unemployment-at-3-2/
https://finance-commerce.com/2024/08/deed-states-unemployment-rate-ticks-up-to-3-2/