Labor Market Information: Key Factors Driving Current & Future Job Demand in Michigan

1. Labor Market Information: Key Factors Driving Current & Future Job Demand in Michigan Michigan Department of Technology, Management & Budget Bureau of Labor Market Information & Strategic Initiatives

2. Key Factors Driving Job Demand • What are some of the key current trends in the Michigan labor market? • What are likely to be some of the key futuretrends in the Michigan labor market? • For some of Michigan’s key sectors: • What are the key factors driving current job demand in those industries? • What may be some of the factors impacting future job demand in these sectors?

3. Who We Are… • Bureau of Labor Market Information and Strategic Initiatives, part of the Department of Technology, Management and Budget • Responsible for producing and publishing information and analysis on the Michigan workforce and the state’s regions and counties • Most of our staff is located in Detroit, but a few economic analysts are situated in Lansing and other Michigan regions • Information on employment, unemployment, industry job trends, skill sets, occupations, wages, demographics of the labor pool, etc.

4. Key Recent Labor Market Trendsin Michigan • Labor force decline may have bottomed out • Michigan workforce levels fell for six consecutive years from 2007-2012 • Workforce levels rose by 37,000 in 2013, the first increase since 2006 • Michigan jobless rate dropped in 2013 for the fourth consecutive year, but remains above pre-recessionary level • Far fewer layoffs recently of persons with jobs, but job market remains competitive for the unemployed • Average duration of unemployment at a very high level; about 39 weeks

5. Jobless Rate Gap (Michigan vs. U.S.) Has Narrowed Since 2009 Michigan Rate Still Above 2008 Levels

6. Recent Trends in Jobs • Payroll jobs advanced in Michigan in 2013 for the third consecutive year • Michigan job gains over the last several years: • Manufacturing • Health care • Technical services • Temporary help services • Restaurants • Mortgage banking • Job losses primarily in government

7. Recent Trends in Job Openings • Michigan top occupations with online job vacancies: • Registered nurses • Truck drivers • Retail sales workers and managers • Industrial engineers • Customer service representatives • Mechanical engineers • Computer systems analysts • Faster openings growth over year in services, transportation, installation & repair, health care support, and management occupations • Slow growth over year in clerical and sales job postings • Diverse set of industry sectors posting jobs

8. Potential Future Trends in the Michigan Labor Market • Michigan population and labor force growth expected to be more modest than national average • Aging of the workforce will impact demand for goods and services, and produce job openings for replacement workers • Above average job growth expected for jobs requiring an associate’s, bachelor’s, or master’s degree • Continued “upskilling” of jobs expected in some sectors in terms of educational/training requirements • Additional educational attainment will continue to be associated with lower unemployment rates and higher wages

9. Michigan Health Care Jobs Record Job Levels in 2013

10. Health CareRecent Factors Driving Job Demand • Only sector in Michigan with continuous job expansion even through the recession • Strong job gains in doctor’s offices, hospitals, home health care, social services • Investment in health care technology has created jobs in Michigan • Several prestigious medical centers in Michigan attract patients and conduct medical research • The aging of the Michigan population has generated increased demand for health services

11. Health CareFactors That May Impact Future Job Demand • Continued aging of the population – “Baby-boom” generation will be entirely 55+ by 2020 • Health status of the population • Emphasis on preventative care and home care could change dynamics of job demand • Continued pace of investment in health care technology • Health care labor supply – will need to replace an aging health care workforce • Health care reform and the need for cost containment in the overall health care system

12. Michigan Professional & Technical Services Jobs Jobs at Highest Level Since 2001

13. Professional & Technical ServicesRecent Factors Driving Job Demand • Sector is a key source of “knowledge jobs” for the Michigan economy; many high skill–high wage positions • Strong recent job additions in Engineering services, IT services, Research and development • Michigan highly ranked nationally in number and share of science and engineering jobs • Strong recovery of auto industry has promoted much of the recent job expansion in this sector • Increased jobs in business consulting and IT services have benefited by rebound in business investment after recession

14. Professional & Technical ServicesFactors That May Impact Future Job Demand • Michigan’s competitive advantage: A very high current share of jobs in engineering services • Future concentration of white collar technical jobs related to the auto industry • Pace of insourcing or outsourcing of IT functions • Technical jobs comprise an increased share of total jobs across many industries, leading to overall job gains • Technical services labor supply • Highly educated with most jobs requiring bachelor’s, associate’s degrees and above • Women are underrepresented in IT and engineering positions

15. Michigan Manufacturing Jobs Led Job Recovery Since Recession

16. ManufacturingRecent Factors Driving Job Demand • Manufacturing jobs in Michigan • Cut in almost half from 1999 to 2009 • Sector is top source of job growth over last year in Michigan economy • Recent job expansion primarily reflects strong rebound in domestic auto sales and auto production • Significant levels of investment in Michigan auto assembly operations • Job advances since 2009 reflect both recalls of laid off workers and new hires • Broad gains, with job growth rates of over 25 percent since 2009 in fabricated metals, plastics, primary metals, autos, and machinery manufacturing

17. ManufacturingFactors That May Impact Future Job Demand • Michigan’s competitive advantage: Skilled labor supply in advanced manufacturing production and auto-related design and engineering • Productivity gains and automation will tend to limit long-term job expansion in manufacturing • Pace of insourcing or outsourcing of production work • Michigan manufacturing success in export markets • Labor supply issues • Production jobs increasingly require technical education and skill • Young people will need to be attracted to production occupations to replace an aging workforce

18. Michigan Employment Services Jobs Rapid Response to Improved Post-Recession Economic Conditions

19. Employment ServicesRecent Factors Driving Job Demand • High sensitivity to economic conditions • 24 percent job drop in Michigan from 2007 to 2009 • All of this job loss recovered in 2010-2012 • Temporary help sector now supplies labor to a wide range of private and public employers • Not all statistics on job gains in this industry reflect new jobs; some reflects a shift in jobs to temporary agencies or professional employer organizations • Temporary help jobs increasingly used in early stages of an economic recovery?

20. Employment ServicesFactors That May Impact Future Job Demand • Will employers increase utilization of a just-in-time labor supply? • Increased staffing flexibility • Quality of the temporary workforce and training issues • Some workers in temporary jobs may value mobility across job assignments; others may prefer to migrate into permanent work through a temporary assignment • Temporary workforce now has wider diversity in occupations and skill levels than before • Average weekly wage in employment services only two-thirds of wage for all private sector jobs

21. Michigan Restaurant Industry Jobs Jobs Rebound to 2007 Levels

22. RestaurantsRecent Factors Driving Job Demand • Recent Michigan restaurant industry job growth matched the rate of gain of private sector jobs • 2012-2013 • Michigan Private Sector Jobs: +2.3 percent • Michigan Restaurant Industry Jobs: +2.4 percent • Disposable income gains positive in Michigan for 3 consecutive years: • 2010: +2.2 percent • 2011: +4.1 percent • 2012: +3.1 percent

23. RestaurantsFactors That May Impact Future Job Demand • Population growth • Overall economic health • Disposable income growth • Consumer confidence • Consumer preferences • Interest in local sourcing of food and nutrition

24. Contains current monthly and quarterly data on the Michigan and regional job markets Economic data can be downloaded on a customized basis using Data Explorer tool Many publications with information on regional workforce trends Employment, unemployment, industries, occupations, forecasts, more DTMB Labor Market Information Website (www.michigan.gov/lmi)

25. Other Useful Websites • Bureau of Labor Statistics www.bls.gov • Census Bureau www.census.gov • American Community Survey www.census.gov/acs/www • OnTheMap http://onthemap.ces.census.gov • Bureau of Economic Analysis www.bea.gov

26. Key Factors Driving Current & Future Job Demand in Michigan For additional information: Bureau of Labor Market Information & Strategic Initiatives Bruce Weaver Manager of Labor Market Analysis 313.456.3091 weaverb1@michigan.gov Please visit our website at www.michigan.gov/lmi