Labor market showing modest job declines and 'loosening,' DED analyst tells Otter Tail County convening

At the Otter Tail County quarterly workforce convening, Anthony Shoffhauser, a regional analyst with DED’s labor market information office, told county and regional workforce partners that the local labor market is "loosening," with employment through the third quarter of 2025 about 283 jobs (roughly 1.2%) below Otter Tail County’s 2019 level of 22,912.

Shoffhauser said the county’s annual unemployment rate rose to about 4.4% in 2025, the highest in five years, and monthly unemployment showed an atypical jump in November and December. He cautioned the pattern merits monitoring but said that unemployment-insurance claims did not show the same spike: claims were lower than a year earlier, suggesting loosening without broad UI stress.

The analyst stressed that the aggregate numbers mask large differences across industries. "Healthcare and social assistance added the most jobs," Shoffhauser said, though that sector still had 109 fewer jobs than in 2019. Construction, accommodation and food services, utilities, arts and recreation, agriculture, and transportation and warehousing showed growth in recent years, while retail trade and manufacturing posted notable declines (manufacturing down about 257 jobs since 2019).

Shoffhauser emphasized that sectors with net job losses can nonetheless have sizable hiring needs because of replacement openings. Using regional projections, he said northwest Minnesota expects modest expansion growth but very large numbers of openings from labor-market exits (for example, retirement) and occupational transfers — a reminder that training and retention policy should address replacement demand as well as growth.

Population change and migration played a central role in the county’s labor-force dynamics, Shoffhauser said. He said positive net migration, including international migration in 2023–24, produced an estimated gain of roughly 470 people in the county’s traditional working-age population (16–64). "We would have had roughly 470 fewer workers without it," he said, noting local labor-force planning that assumes different migration scenarios can lead to contrasting projections.

Looking ahead, Shoffhauser warned that Otter Tail County’s age structure—relatively large shares of baby boomers and smaller Gen X/Gen Z cohorts—creates risk for labor-force declines unless migration continues to replenish working-age cohorts. He urged employers and local partners to pursue multiple strategies: connect with high schools, create clear career ladders, offer retraining and credentialing, and consider flexible or encore-career roles to retain or re-engage workers.

The county’s convening organizers said the DED slides and the meeting recording will be shared with participants. No formal votes or motions occurred during the presentation.