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Rochester Labor Market Outlook 2013 - 2020

Rochester Labor Market Outlook 2013 - 2020. Brent Pearson Regional Labor Market Analyst MN Dept. of Employment & Economic Development. About DEED’s Regional Analysts. Collaborate with regional stakeholders on new research Extend access to DEED reports and statistics

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Rochester Labor Market Outlook 2013 - 2020

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  1. Rochester Labor Market Outlook 2013 - 2020 Brent Pearson Regional Labor Market Analyst MN Dept. of Employment & Economic Development

  2. About DEED’s Regional Analysts • Collaborate with regional stakeholders on new research • Extend access to DEED reports and statistics • Conduct presentations and training onregional economy and labor market • Original research and analysis intended to answer “the tough questions” • Five regional analystsstationed across the state

  3. LMI Performance • Current Conditions • Wage Details • Opportunities for Job Seekers (JVS) • Outlook (projections) • MN Labor Demographics

  4. Labor Market Supply (Unemployment Rates)Recessionary Peaks = 9.8 US, 9.0 MN, 8.2 in SE • Use as guide only (economic indicator, not practical for job seekers) • Unemployed/Total Labor Force (Unemp. + Emp.) • MN 5.1% in Aaug(low), 7.3 (US), 4.5 (SE), 4.1 (Rochester) • Regionally, typically a tick below state and way below nation (MSA impact, diverse industry)

  5. 1. Current Conditions Measured monthly and annually: large cities, county, state, nationally • Olmsted, Blue Earth and Nicollet historically lowest (MSA effect) • Mankato-North Mankato MSA had lowest yearly unemployment rate of any MSA every year since ‘98 (caveat) • Rochester/Mankato MSAs have lowest current at 4.1% • Recovery continues • Annual drop in Unemp%, totals, increase employed, more vacancies, fewer job seekers/vacancy • Lower % unemp. But trend line mirrors state, nation • What IS important (recovery, still work to do) • MN 512% = nearly 152,000+ unemployed • SE 4.5% = 12,000+ • Rochester 4.1% = nearly 2,500

  6. Recovery: Still Work To DoJOBS (although good news!) STATEWIDE = WE’RE BACK!! +12,200 jobs in August, 2013 – finally push past pre-recessionary peak of Feb. 2008! SE – Compare to 2007, 6 month lag on data should see Q2 results early 2014. Recovery OTY: (Rec. slower past year except TC Metro)= Rochester up .1% from August 2012; private sector is at pre-recessionary levels in Roch – outstate SE iclosing in (-0.5%) – again, represents 2012 (2013 is coming)

  7. 2. Major Employment Industries Top 5 emp. Sectors mirror state 1 in 4 in SE = HC 1 in 5 in SC = Mfg (1 in 6 SE) MFG hit hard by recent recession -2600 in SC alone Retail Trade = huge, lower wages/more PT/Seasonal

  8. Which Industries have recovered well, which have not (SE)? 2009 - 2012 • Industries rely on production (rubber mfg+, non-metallic mineral + chemical on rise) and consumption continue adding jobs. • Health Care, Administration Support added jobs, food services also added jobs – since 2009. • Govt. Jobs dropping (public administration – economic and environment programs hardest hit), so is education OTY – (early bump in recovery 4thlargest industry in region - elementary) • Real Estate, Retail, Utilities holding course • Recovery mirrors nation – production + consumption up, housing and construction same and govt. funded employment dropping

  9. Where Expansion is Important Industry Growth in: • Management of companies and enterprises • Finance and insurance • Transportation & Warehousing • Produces or mirrors growth in other industries, shows flow of materials and commerce = good for economic vitality

  10. 2. Wages Median Hourly Wage Need in Greater MN for 1 person – Employer-Provided HC is $11/hr Fam 4 = 2 parents FT = $12.56 • Median $16.99/hrSC • Wages drop as head west (SC + SW –SE –State) • Reenforces industry average weekly wage findings (higher paid industries – Public Admin, natural resources +_ mining = employment losses or modest gains during recovery) • Mfg still essential – about $1.18 , Ed/Health = nearly $4 higher than median across all industries +job gains during recovery

  11. Average Work Week DeclineRegionally, Nationally • All Private Employment • Pre-Recession – 33.2 • Presently – 32.3 • State – 32.7, and 33.1 • U.S. – 34.6, 34.0

  12. 3. Opportunities for Job Seekers Job Vacancy Survey • Survey twice per year • 10,000 employers – across state • Asks about job vacancies (open-for-hire) and future hiring demands • Stratified – touches all industries and places

  13. Job Vacancies • Job Vacancies up, unemployment down • Height of recession = 10 job seekers per opening, 2.6now

  14. Where the vacancies are…JVS – 4Q, 2012 • 42% of all vacancies statewide = require post-secondary education • (SE =40%, SC=42%) • 39% of all vacancies statewide = PT • (SE =49%, SC = 43%)

  15. Job Vacancies • Most occupations fit into multiple industries • But we know that most production is mfg • Over the year vacancies in MFG have slowed but still gained 165% in past year 16 fold during recovery • MFGs still have hiring needs • Technical health care practitioners have some of the highest wages of any occupation, fewer vacancies 2011 to 2012 • Healthcare support (dentists assistants, etc.) gained vacancies but slight (lower paid)

  16. Occupations in Demand (OID) • OID are currently available career opportunities in a region as determined by regularly updated local labor market data • The OID list for a region is the group of occupations that rank highest on a Current Demand Indicator which measures local short-term demand conditions • Based on: • Job Vacancy Survey (later) • Occupational Employment Statistics (OES) • Unemployment Insurance Claims • Available for all Economic Development Regions • Updated through June 2013 (Median Annual Salary from Minnesota Salary Survey) • Projected Employment Data from the 2010-2020  Minnesota Employment Projections Program

  17. Top Occupations in Demand SE

  18. 4. Outlook (projections) • Projections use an advanced statistical model (BLS) • Done every two years – 10 years out (using most recent LMI surveys) • Projections – caveat - we can never really know what the future will hold (Rochester $500-million infrastructure – 40,000 jobs? How do you project an event like that?)

  19. SE Projections forecast projected job growth and replacement hires

  20. SE Outlook…. • 26,384 new jobs + 59,620 replacement = over 96,000 projected openings by 2020! • Sales, Office, Production, Food Prep, Health Care, Production all project well • Arts, farming, architecture, and legal project smallest growth

  21. DMC Projections….

  22. DEED Projections for Similar (HC TECHNICAL)

  23. DEED Projections for Similar (HC SUPPORT) – LOWER PAYING than TECH/PRACTITIONER

  24. Similar Occs. In all, our message is that the projected job growth due to DMC is not unprecedented. Reasonably attainable, but a few notable differences… (next slide)

  25. Differences… But similar message • We also show strong growth in health care, service sector, commercial/professional, many of the industries that will be added by DMC. • We project to 2020 across all industries, DMC projects growth for their project to 2030 • We project for 11 Counties in SE MN, DMC projects for “Rochester Area” • Our projections do not include DMC, using 2010 as baseline… (here’s why)

  26. Keep in mind (projections) • It’s only math • Not self-fulfilling prophecy • Movement of a major employer into a region cannot be accurately projected • Reason we refine every 2 years, 10 years out • Projections merely measure point A results with point B results (not spread uniformly across all ten years – some industry or occupation growth may happen closer to front end of cycle, some later) • Useful as a measure gauge of growth/decline, not intended to pinpoint precise number.

  27. For more on DMC-related occupational growth measured by DEED Go to: www.positivelyminnesota.com Search: Brent Pearson (or June 2013, TRENDS – for PDF of article, request a copy) Most recent article in my bio: http://www.positivelyminnesota.com/Data_Publications/Economic_Trends_Magazine/June_2013_Edition/The_Mayo_Clinic_Jobs.aspx

  28. 5. Demographics

  29. Projected Labor Force 2035 SC • 2015 to 2035 labor force shifting into 65+ (upcoming slide) • Blue, Earth, Nicollet and Le Sueur projected to increase by 2015

  30. Projected Labor Force 2035 SE • Projected increase in 8 of 11 counties • Projections highest near MSAs (TC and Roch) • MSA affect, region includes one MSA, borders another (TC), and near a 3rd (MKTO-NMKTO)

  31. Projected Age of Labor Force Changes by 2035 More workers still in 25 to 44 and 45 to 64 cohort Percentage in 16 to 24 and 25 to 44 down Percentage of 65+ up

  32. MN Unemployment Rate by Educational Attainment • More education = lower unemp. Rate • 58% unemployed (90,000 MN had SOME college) • MN UnempRate for college grads – below 4% • BLS

  33. Commute Corridor • Rochester retains significant (76.1%) part of its workforce – workers that live in Rochester, work here! • Shares some workforce with Twin Cities • Highway 52, key commuter corridor

  34. We know where we’re exporting workers to, but where are we pulling from? • Last slide shows where people that LIVE in Rochester go for work. • This shows where people that WORK in Rochester LIVE. • Rochester pulls 53.7 of workforce from rural SE and Twin Cities

  35. Summary – Recovery Continues • In our 3rd year of measurable data since recession’s peak • Statewide, we’re back to pre-recessionary levels of employment – Roch and SE MN still in waiting for data to catch up (as of 2012, still needed 323 jobs for Roch and 1,100 for SE but private sector was already showing recovery) • Some industries are not recovering (public administration, construction, finance) • May continue to decline, could be shift, may recover at some point – next few years will tell • Unemployment continues to drop as job vacancies rise • Manufacturing and health care still dominates the landscape, but other industries such as retail trade, health care, and educational services still high • SE needs to maintain industry diversification • By 2035, the workforce for aged 65+ will nearly double across the state and parts of SC MN • DMC will open more jobs between now and 2030

  36. Q & A session later • Regional Analysis Unit • RAO Manager, Twin Cities • Rachel Vilsack • 651-259-7403 (St. Paul) • Central, Southwest • Cameron Macht • 320-441-6567 (Willmar) • Northwest • Tim O’Neill • 218-825-2183 (Brainerd) • Northeast • Jan Saxhaug • 218-302-8413 (Duluth) Brent Pearson South Central & Southeast Regional Analyst Minnesota Department of Employment & Economic Development • 507-389-1896 (Mankato) • brent.pearson@state.mn.us Thank You!

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