The Northland Economy and the Future of the Job Market
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The Northland Economy and the Future of the Job Market Drew Digby, Regional Labor Market Analyst, DEED Northland Human Resources Association December 9, 2008. Overview. Where are we right now What you can do for your employees if you are laying them off Where have we been

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The Northland Economy and the Future of the Job Market

Drew Digby,

Regional Labor Market Analyst, DEED

Northland Human Resources Association

December 9, 2008


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Overview

  • Where are we right now

  • What you can do for your employees if you are laying them off

  • Where have we been

  • What’s the future economy look like


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Where are we right now

  • Minnesota’s October unemployment rate is 6.0%, up from 4.6% a year ago

  • U.S. is 6.5%, up from 4.7%

  • Duluth is 5.8%, up from 4.5% a year ago

  • NE Minnesota is 6.4%, up from 4.9% a year ago


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What do those number really mean?

In Duluth, in one year, we’ve lost 651 jobs between last October and this October. About three times that number in the whole region


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What happened in November

Unemployment claims rose nearly 32% in November for our region.

Statewide, they were up 43%


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By comparison, we’re doing okay

Our bad news is not as bad as it is elsewhere and we need to learn to use that to our advantage


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Some numbers to back that up

  • November was bad, but November 2001 was nearly 20% worse for Northeast Minnesota.

  • Our average number of unemployment claims is up just 14% over the previous 5-year average.


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Where is it really bad up here?

  • Manufacturing

  • Administrative and Waste Services

  • Public Administration

  • Sales


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Health Care is it’s own category

  • Health Care layoffs are very high historically here, but by comparison with other industries – so far – they are relatively mild.

  • 174 claims in Nov. 2008 vs. 418 in Manufacturing and Health Care is five times bigger as an industry.


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Where are we doing well or okay

  • Professional and Technical Services

  • Education


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Why are we not doing so bad

  • We didn’t have a major residential construction industry that had dramatically overbuilt to fall apart.

  • We have done a very good job of diversifying our economy


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A short plug if you’re doing layoffs

Minnesotaworks.net

Duluth Workforce Center

218.723.4730


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Where have we been

30 years ago in Duluth, more than 24% of all workers had a government job.


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Today

Just 12.7% of Duluth workers have a government job


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What other big changes

Professional and Technical Services (especially architecture and engineering) are on the rise.

In 2007, they employed 2,176, a rise of 13.9% over five years and had total wage growth of 25.4%


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Aviation

  • Until the last few months, aviation had held a bright spot in manufacturing. Although manufacturing jobs have been steadily disappearing – to innovation as well as outsourcing – within Duluth they had rise nearly 7% over the previous 5 years.


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Industrial Sewing

One of the more interesting sectors has been the Industrial Sewing, which includes everything from Duluth Pack to Aerostitch to smaller operations working with canvas. Some 30+ employers indentified and working with Lake Superior College and SOAR to train new employees.


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Health Care

  • In Duluth, Health Care employment rose 20.4% between 2002 and 2007.

  • That accounted for 23.8% of all jobs and 28% of all wages that workers in Duluth took home


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Health Care is not about our age profile

  • Yes, we have an aging population, but some of our greatest growth has happened in non-elderly residential care.

  • Community Care for the Elderly rose 55.4%.

  • Other Residential Care facilities rose 121.1%


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Health Care Jobs in the Region

  • 18.8% of all jobs in our region are in health care, compared to 12.3% statewide.

  • In Duluth, 23.8% of all jobs, and 28% of all wages, come from the health care industry.

  • St Louis County: 21.1% of jobs are in health care.

  • Northeast Minnesota EXCLUDING St. Louis County: 13.8% of its jobs in health care.


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Higher Education

  • Huge increase in jobs, wages over last 5 years.

  • Much uncertainty ahead.

  • Really an industry we need to treat as an industry.


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Mobility

Some interesting new data from the Census suggests that our population is 20-35% more mobile than it used to be. In St. Louis County, between 6 and 8% of the population is new each year in the last three years.


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Mobility and the Age Profile

Preliminary data suggests that more folks are moving away when they retire and that our median age has actually gone DOWN since 2000. (Still within the margin of error, we need more data.)


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Workforce of the Future

  • We still need more people for the workforce in the future as the baby boomers retire.

  • Current economic situation gives us 3-5 more years.

  • We might be able to take advantage of the current situation to bring people in.


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How many people do we really need?

About 22,000 additional workers over the next 10 years.


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What kind of people do we need

  • General Technical skills who can be trained and retrained

  • Nurses

  • Health Care Technical jobs

  • Architecture and Engineering primary and support workers


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Where are they going to come from

  • Children who grow up here.

  • College students who come here for college

  • Older workers who want or need to keep working

  • Adults here not currently in the labor force

  • General flow of migrants from all places


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What do we need to do

  • Primarily, we need to be open to new people, new ideas, new ways of doing things.

  • The industries that are doing the best are ones that have gone through a lot of transformation.


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Thanks

Drew Digby

Regional Labor Market Analyst

DEED

[email protected]

218.723.4775


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