The McKnight Foundation of Minneapolis is giving the cities of Minneapolis and St. Paul each $1 million to provide jobs for 400 people in "dire need of emergency job assistance and who have no known avenues of assistance open to them."

The Work Opportunity Project, as it is called, will pay $4.25 an hour for a 40-hour week during the next six months. Those hired will work for the cities--on park department projects, for example--or for non-profit community agencies. Applications for the 400 positions reached 2,000 Friday, the day it was announced.

Although the supervisors will try to find private sector jobs for the 400, city officials regard the McKnight Project as a temporary quick economic fix.

Mayor George Latimer, a St. Paul Democrat, praised the foundation but said: "Let's not fool ourselves, it's not a long-term program." Likewise, Minneapolis Mayor Don Fraser, also a Democrat, said, "We have a socially conscious private sector in the Twin Cities but there's no way they can make up the gap of what's been cut."

Reagan administration officials have expressed the hope that the private sector will absorb those left jobless by sharp cutbacks in public jobs programs, such as those administered under the Comprehensive Employment and Training Act (CETA).

The local CETA offices will screen applicants, and the project will fill--but only in part--the gaps left by budget cuts that reduced the CETA programs by about 50 percent. According to the McKnight Foundation, the area's rising unemployment figures tell only half the story. They don't indicate the stagnation of the work force and the fact that many have exhausted unemployment benefits.

Among the requirements, an applicant must have been unemployed for 30 days and not be in school. One Reagan administraton criticism of CETA was that fulltime students were on CETA rolls. But because they were cut off in the Twin Cities last year, the McKnight project rule creates no new hardship for students.