Regional Planning in Central Minnesota

1
Regional Planning in Central Minnesota

• Cameron Macht
• Regional Analyst, Central MN
• Dept. of Employment and Economic Development
• www.deed.state.mn.us/lmi/
• 320-231-5174 ext. 7535
• cameron.macht_at_state.mn.us

2
Presentation Agenda

• Regional profiling in Central MN
• Changing Demographics
• Changing Labor Force
• Changing Economy
• Conclusions and Questions

3
Why Does Regional Matter?

• Despite the intricacies of each countys
  workforce and economy, there are more
  similarities than differences
  
• We are in a global competition for good jobs and
  good workers including our own youth!
  
• Businesses and people make decisions on where to
  locate based on the image and reputationof the
  region
  
• Central Minnesota is at a turning point
• Competing on low-cost, low-wage production
• Rural areas, but also other countries
• Competing on high skills that can support higher
  wages

4
Opportunities For Success

• There is no guarantee that Central Minnesota will
  be a region in which advanced manufacturing or
  other high-skilled industries can compete and
  survive
• This report presents a baseline of information
  about where the region stands today
  
• There are strengths and weaknesses
• The challenge for Central Minnesota isto fully
  embrace the notion of becoming aregion that is
  focused on growingemployment in high-skill
  industries
• That change will require strategic thinking,
  commitment, and effective leadership

5
There Are No Easy Answers

• Regions and economies are giant, complex
  organisms that change slowly in some ways and
  quickly in others
  
• No single idea or answer is going to solve every
  problem or maximize every strength
  
• Everyone should feel open and welcome to provide
  ideas, comments, and feedback at any time
  
• Everyone needs to be able to say whatever they
  want to say whenever they want to say it.
  
• This meeting is for brainstorming and creating
  ideas the next meeting will focus on
  formulating action plans and building work
  groups/industry forums

6
Pick the most important factors

• Low Labor Cost
• High Labor Quality
• High Labor Availability
• Access to Markets
• Access to Suppliers
• Access to Transportation
• Low Taxes
• Economic Development Incentives

• Public Services
• Industry Clusters
• Infrastructure and Utilities
• Available Buildings/Offices
• Natural Amenities
• Consumer and Cultural Amenities
• Quick, Consistent Regulation
• Non-adversarial Regulators

7
Actually, theyre all important

• Depending on the needs of the individual
  business, infrastructure might be the most
  pressing need or access to supplies or quick,
  consistent regulation
• Our research on location factors has shown that
  labor force is among the most important factors
  will the workers with the needed skills come to
  work?
• Central MN has an educated,affordable, growing
  workforce
  
• Taxes and economic devel-opment incentives serve
  asa tie-breaker when other conditions have been
  met

8
Availability, Affordability, and Quality of Labor
Force

• Workers are less mobile than other factors of
  production, making availability very important
  
• The availability measure that is most strongly
  related to site selection is the presence of
  workers in the occupations needed for particular
  industries
• Businesses will pay more for higher quality
  workers, but would rather have equivalently
  skilled workers at lower wages
  
• Research finds that higher wages have a stunting
  effect on growth, all else being equal
  
• This is not surprising because labor is a large
  component of operating costs for businesses

9
Population is Growing Rapidly

• Region 6E has seen a steady incline 21.3
  increase in population since 1960-2003
  
• Region 7E has seen explosive growth 121.4
  increase in population since 1960-2003
  
• Sherburne and Wright County have seen explosive
  growth 314 increase in population since
  1960-2003
  
• Sherburne County was 2nd fastest
• Wright County was 7th fastest
• State of Minnesota increased 48.2 from 1960 to
  2003
  
• Central Minnesota more than doubled (114.5
  increase)

10
Percent Population Change, 1990 to 2000
Growing Rapidly Only Renville County lost populat
ion between 1990 and 2000 Chisago 34.7 Isanti
20.7 Kanabec 17.1 Kandiyohi 6.3 McLeod
9.0 Meeker 8.6 Mille Lacs 19.6 Pine 24.8
Renville -2.9 Sherburne 53.6 Wright 31.0
Central Minnesota 9.1 from 2000-2003 State
2.8
Source 1990 2000 Census
11
Positive Rate of Natural Increase
In 9 of the 11 counties, there were more births
than deaths Only Renville and Mille Lacs County h
ad more deaths than births Sherburne and Wright h
ad more than 1,000 births, Chisago and Kandiyohi
had more than 500 births Central Minnesota has
a natural rate of increase of 6 percent
The state of Minnesota has a natural rate of
increase of 6 percent Central Minnesota has larg
er average family sizes All 11 counties were larg
er than 3 people, as compared to only 4 of 14
counties in Southwest Minnesota
Chisago, Isanti, Sherburne, and Wright were the
largest
12
Young Married-Couple Families

• Central Minnesota has a high percentage of young,
  married-couple families
  
• 84.6 of all families
• State 82 U.S. 76.7
• Much higher in the younger age groups 25 to 34
  years, 35 to 44 years, 45 to 54 years
  
• Younger, married-couples tend to have more
  children
  
• Unlike other regions, Central MN is still seeing
  growth in population under age 5

13
Single Parent Families, 2000
Meeting the Need The five counties in East Centra
l Minnesota have some of the highest rates of
single parent families in the state
Could indicate demand for affordable child care,
social services, flexible work schedules, and
health benefits
14
Projected Population Change, 2000 to 2030
Big Getting Bigger Twin Cities will continue to
expand north and west Regional centers and lakes
areas will also see continued growth
Chisago 69.1 Isanti 35.4 Kanabec 43.4
Kandiyohi 15.7 McLeod 19.1 Meeker
23.1 Mille Lacs 53 Pine 42.6 Renville
-2.9 Sherburne 53.6 Wright 31.0
15
Projections
Central Minnesota can expect a huge 43.6 pop.
increase from 2000 to 2030 Due to births and in-m
igration Also longer life expectancies Every age
group will grow 35-39 sees the slowest growth 2
5-29 sees impressive gains 0-19 also growing quic
kly Every age group from 55 years on will grow ra
pidly 65-79 sees the biggest growth However, thi
s assumes that retirees will remain in the region
16
Migration Patterns Losing Our Youth?
Net Migration, Age 30 to 44
Net Migration, Age 15 to 24
Source 1990 2000 Census
17
In-migration becomes important

• Central Minnesota gained 93,960 new in-migrants
  from 1995 to 2000
  
• One out of every four people in Central
  Minnesota lived in a different county, state, or
  country in 1995
  
• Nearly 35 in Sherburne, less than 15 in
  Renville
  
• More than 40,000 new residents from 2000 to
  2003
  
• Not all in-migrants, though

18
Minority Populations, 2000
Central Minnesota is still 96.5 white
Only Kandiyohi (93.6), Mille Lacs (93.6), and
Pine County (94.4) are below that line
People of Hispanic origin increased the most in
Central Minnesota, with the largest populations
in Kandiyohi, Wright, Sherburne, and McLeod
Growing fastest in McLeod and Renville
Source 2000 Census
19
Nonwhite populations grow faster

• Minnesotas nonwhite and Latino populations are
  projected to grow substantially faster than the
  white population
  
• By 2030, 1 in every 5Minnesotans will
  beHispanic or of color
  
• The more rapid pop.gains are attributable to
  higher rates of in-migration, higher
  birthrates, and a youngerage composition
  
• Blacks, Asians, and Hispanics will growthe
  fastest

20
Housing Demands

• The regions demographic growth has led to
  increasing demands on each countys housing
  stock
  
• Eight of the 11 counties in Central Minnesota
  have a newer housing stock at least based on
  the median year that the structure was built
  than the state
• Only Renville (1951), Meeker (1963), and McLeod
  County (1969) had older median dates than the
  state (1969)
  
• Sherburne (1985), Chisago (1980), and Wright
  (1978) had the newest housing stocks
  
• Likewise, eight of the 11 counties had a higher
  percentage of total housing units built between
  1999 and 2000 than the state as a whole
  
• Through November of 2004, both Sherburne (1,452
  units) and Wright County (2,018 units) have
  surpassed Carver County (1,142 units) as well as
  Olmsted County the Rochester MSA which had
  1,208 new units

21
Why?
Access to a skilled work force remains the No. 1
priority of corporate site seekers, according to
a recent Site Selection survey of economic
development (ED) groups and service providers.
Survey Reveals New Factors Behind Site Location
Decisions by Mark Arend, Site Selection magazi
ne, May 1999
22
Brainstorming about Demographics

23
A Job Bust from the Baby Boom?
Labor force participation rates are increasing
for Women of all ages For females aged 16 years
and over, Labor force participation rates grew
from 62.5 in 1990 to 66.0 in 2000 (Minnesota
ranks 1 in the U.S.) Older adults For males age
d 65 to 69, Labor force participation rates grew
from 28.7 in 1990 to 33.2 in 2000 females
grew 18.2 to 24.0 Teenagers For males aged 16
to 19, Labor force participation grew from
59.7 in 1990 to 60.3 in 2000 females grew
from 61.0 to 63.9
24
Not Necessarily

• The Region 6E labor force is projected to grow
  15.1 to 2030
  
• Female labor force will grow 17.3 in Region 6E
• 65 years labor force will grow 163.9
• 25-44 years labor force will decline -1.2

25
Not Necessarily

• The Region 7E labor force is projected to grow
  48.1 to 2030
  
• Female labor force will grow 49.0 in Region 7E
• 65 years labor force will grow 262.7
• 25-44 years labor force will increase 25.5

26
Not Necessarily

• The Region 7W labor force is projected to grow
  49.6 to 2030
  
• Female labor force will grow 49.5 in Region 7W
• 65 years labor force will grow 271.5
• 25-44 years labor force will increase 30.5

27
Women in the Workforce, 1980 to 2000
Expanding Labor Force Since 1980, there has been
a huge increase in female labor force
participation The counties with the largest chang
e can be found in Central East Central
Minnesota Partially because of population growth
Renville, Pine, and Mille Lacs all lagged the
state Sherburne and Wright easily surpassed the
state rate Closer to the metro
28
Working Outside County of Residence, 2000
Commuting Counties Counties surrounding the Twin
Cities Metro Area and St. Cloud MSA are supplying
the workers, not the jobs Central Minnesota is a
net exporter of labor Percent of Residents Workin
g Outside County of Residence Sherburne County
67.4 Chisago County 63.4 Isanti County 59.7
Wright County 56.8 State of Minnesota 33.
7 McLeod County 25.0 Kandiyohi County 11.6

29
Average Commuting Times, 2000
Commuting Counties Central MN has some of the lon
gest mean travel times to work in the state
More than 33.5 of Isanti and 32 of Chisago
workers spent more than 45 minutes in the car one
way to work each day! Only Renville, McLeod, and
Kandiyohi had more than half of their residents
driving less than 15 mins. 10 percent of Kanabec
residents drove over 90 minutes each way!
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31
Demography and the Economy

• This is a significant export of human capital,
  which could be used within the region instead
  
• However, many of the jobs people are driving for
  are paying much higher wages or have higher
  educational requirements
  
• Central Minnesota may want to focus on strategies
  that build more businesses within the region,
  rather than sending half of its workforce into
  other areas each day
• Todays businesses require more competent labor,
  as skill sets and training demands change every
  couple years due to shorter product cycles and
  new product introductions
• Companies value workers who are well-trained,
  but also trainable
  
• Companies look at the areas labor force

32
What Does It Mean?

• Dynamic labor markets are characterized by
  population growth and in-migration
  
• Productivity increases may be an indication of
  adaptability
  
• Workforce development
• Recruitment
• Relocation
• What comes first, the people or the jobs?
• Population and income growth generates demand
  for services
  
• Companies will look at local post-secondary
  institutions for retraining

33
Educational Attainment

• Central Minnesota lags the state in some measures
  of educational attainment - fewer workers have
  bachelors or advanced degrees
  
• 51 percent of the population aged 25 years and
  over stopped with a High School diploma or less
  (State 40.9)
  
• Central Minnesota has a higher percentage of
  residents with at least some college, but no
  degree, and associates degrees
  
• There is a significant gap in bachelors degrees
  (losing our youth?) and advanced degrees

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35
Market-Clearing Match

• Research shows that close to 71 percent of jobs
  in Minnesota and 74.4 percent of jobs in Central
  require only an HS diploma
  
• As compared to 8.9 percent of jobs that require
  some college or an associates degree
  
• 16.7 percent of jobs require a bachelors degree
  or above
  
• Slight unmet demand for workers with bachelors
  degrees
  
• Can they be found among the commuters?

36
The Loyalty Effect

• Research shows that Americans are changing jobs
  and careers more frequently, regardless of the
  economy. The median number of years that wage and
  salary workers had been with their current
  employer (referred to as employee tenure) was 3.7
  years in January 2002
• Despite these trends to the contrary, workers in
  Central Minnesota continue to display a
  remarkable amount of loyalty to their
  employers. According to a recent Labor Force
  Assessment, median employee tenure was set
  almost twice as high, at 6 to 7 years

37
Show Me The Money!

• 87 of respondents rated an increase in pay as
  important with 62 of respondents rating it as
  very important
  
• 81 of respondents rated an increase in job
  benefits as important with 57 of respondents
  rating it as very important
  
• 78 of respondents rated better utilization of
  skills as important
  
• 79 of respondents rated improved working
  conditions as important
  

38
Save Time, Save Money?

• In a late 2001 Labor Force Assessment, we
  interviewed residents in Central Minnesota on a
  variety of workforce issues
  
• How much less pay would workers accept to take a
  job with a shorter commute? (or how much more to
  drive farther?)
  
• Workers are willing to ask 2.00 less per hour to
  drop their commute times! (from 31 to 45 min. or
  46 min. or more)
  
• On the other hand, 50 wouldnt change their
  current travel time

39
Wages are VERY Important

• 90 of respondents rated an increase in pay as
  important with 64 of respondents rating it as
  very important
  
• 87 of respondents rated an increase in job
  benefits as important with 64 of respondents
  rating it as very important
  
• 80 of respondents rated better utilization of
  skills as important
  
• 79 of respondents rated more job security as
  important
  

40
Regional Salaries

• Central Minnesota falls in the middle for
  salaries
  
• Higher than Southwest, Northwest, and South
  Central
  
• Lower than the Twin Cities, Southeast, and
  Northeast
  
• Region 6E 76 of TC
• Region 7E 81.2 of TC
• Region 7W 77.5 of TC
• Lower wages in Central Minnesota are probably one
  reason for our high rate of commuting

41
Wage Comparison Analysis 6E
About 37 percent of all jobs in Region 6E pay
less than 10 per hour State 28 Another 45 pe
rcent pay between 10 and 20 per hour
State 41 The remaining 18 percent pay 20 per
hour or more State 31 7 percent pay 30 or mo
re State 14
42
Wage Comparison Analysis 7E
About 38 percent of all jobs in Region 7E pay
less than 10 per hour State 28 Another 43 pe
rcent pay between 10 and 20 per hour
State 41 The remaining 19 percent pay 20 per
hour or more State 31 7 percent pay 30 or mo
re State 14
43
Wage Comparison Analysis 7W
About 32 percent of all jobs in Region 7W pay
less than 10 per hour State 28 Another 46 pe
rcent pay between 10 and 20 per hour
State 41 The remaining 22 percent pay 20 per
hour or more State 31 8 percent pay 30 or mo
re State 14
44
Wage Comparison Analysis

• The median hourly wage for Region 6E is 12.83
  (84.1 of state)
  
• The median hourly wage for Region 7E is 13.66
  (89.6 of state)
  
• The median hourly wage for Region 7W is 13.03
  (85.4 of state)
  
• The median hourly wage for Minnesota is 15.25
• The highest paying jobs are typically
• Management occupations (29.70-33.21)
• Architecture and engineering occupations
  (21.39-23.23)
  
• Business and financial operations occupations
  (21.07-22.02)
  
• Healthcare Practitioners and Technical
  occupations (22.64-24.02)
  
• Legal occupations (27.84-29.31)
• The lowest paying jobs are concentrated in
• Food preparation and serving related occupations
  (6.92-7.56)
  
• Sales and related occupations (9.00-10.24)
• Building, grounds cleaning, and maint.
  occupations (9.77-10.15)
  
• Personal care and service occupations
  (8.84-9.82)

45
Regional Salary Surveys

• Minnesota Salary Survey is based on a rolling
  survey of 22,000 employers
  
• Updated quarterly and annually for the state,
  regions, and MSAs
  
• Third Quarter 2004
• Distribution stats for 10th, 25th, 50th, 75th,
  and 90th percentiles
  
• Central Minnesota typically pays between 75 and
  85 percent of the metro wage
  

www.deed.state.mn.us/lmi/tools/oes/
46
Competitive Occupational Groups

• Only three major occupational groups pay more in
  Central Minnesota
  
• Education, training, and library occupations
• Farming, fishing, and forestry occupations
• Protective service occupations
• Several occupational groups are competitive
• Healthcare support occupations
• Food preparation and serving related occupations
• Transportation and material moving occupations
• Several occupational groups earn significantly
  less
  
• Management occupations
• Business and financial operations occupations
• Computer and mathematical occupations
• Architecture and engineering occupations
• Arts, design, entertainment, sports, and media
  occupations
  
• Healthcare practitioners and related occupations
• Construction and extraction occupations

47
Wages are growing

• Wages are increasing in Central Minnesota, but
  not as quickly as the state and the Twin Cities
  metro area
  
• Average Annual Wage growth slowed down from 2002
  to 2003
  
• Industries seeing the fastest growth in wages
  include
  
• Professional and Business Services
• Financial Activities
• Public Administration
• Manufacturing

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49
Brainstorming about the Workforce

50
Central MN Economy

• Central Minnesota had 16,558 firms 241,896 jobs
  paying 7.13 billion in 2003
  
• Central MN has 9.4 of total statewide jobs
• 74.7 of employment in Central MN is in
  services-producing industries 25.3 of jobs are
  in the goods-producing domain (state 19.3)
  
• 82.9 of employment in Central MN is in the
  Private sector 17.1 of jobs are in the Public
  or Government sector (state 14.4)
  
• Central MN gained a net of 8,046 jobs and 932
  firms from 2000 to 2003
  
• Minnesota lost -32,865 jobs from 2000 to 2003

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52
Distinguishing Industries

• Value-added Agriculture Production
• Animal Production, Crop Production, Ag. Support
  Activities
  
• Food Manufacturing
• Specialty Manufacturing Sectors
• Nonmetallic Mineral Mfg., Paper Mfg., Textile
  Product Mills
  
• Furniture Related Product Manufacturing (Wood
  Product Mfg.)
  
• Computer Electronic Product Manufacturing
• Truck Transportation and Gasoline Stations
• Utilities
• Heavy Civil Engineering Construction
• Nonstore Retailers
• Healthcare (and Nursing Care for elderly
  residents)

53
Region 6E Economy

• Region 6E had 3,611 firms 52,016 jobs paying
  1.5 billion in 2003
  
• 68.3 of employment in Region 6E is in
  services-producing industries 31.7 of jobs are
  in the goods-producing domain
  
• State of Minnesota 19.3 of jobs in
  goods-producing
  
• 82.6 of jobs are at private sector companies,
  and 17.4 of jobs are in the public sector
  
• State of Minnesota 14.4 of jobs in the public
  sector
  
• Region 6E lost a net of -393 jobs but added 27
  firms from 2000 to 2003

54
Region 6E Blue Collar Economy

• Manufacturing is the largest employing non-ag
  industry in Region 6E, with 22.5 of total
  regional jobs (11,723 jobs)
  
• Statewide, manufacturing comprises 13.4 of total
  jobs, and lost over-40,000 jobs during the
  recession (Q2-2001 to Q2-2004)
  
• Region 6E lost -1,929 manufacturing jobs from
  2001-2004, a -14.1 decline
  
• 3rd highest-paying industry overall at 762 avg.
  weekly wage
  
• Computer Electronic Product Mfg. lost -1,118
  jobs, a -29 decline
  
• Avg. Weekly Wages increased 32.3, from 666 to
  881
  
• Machinery Mfg. lost -447 jobs, a -34.5 decline
• Avg. Weekly Wages increased 9.6, from 677 to
  742
  
• Plastics Rubber Product Mfg. lost -117 jobs, a
  -29.3 decline
  
• Avg. Weekly Wages increased 16.9, from 598 to
  699
  
• Food Mfg. lost only -15 jobs, a -0.4 decline
• Avg. Weekly Wages increased 21.3, from 520 to
  631
  
• Furniture Related Product Mfg. added 79 jobs,
  a 19.8 increase
  
• Avg. Weekly Wages increased 6.0, from 600 to
  636

55
Region 6E Rising Services Economy

• Healthcare Social Assistance makes up 16.2 of
  total regional jobs (8,442 jobs) with 541 avg.
  weekly wage added 911 jobs
  
• 3,131 jobs at Nursing Residential Care
  Facilities 314 avg. wage
  
• Added 425 jobs from 2000 to 2003
• 2,029 jobs at public Hospitals 726 avg. wage
• 1,999 jobs at Ambulatory Healthcare Services
  826 avg. wage
  
• Projected to be the one of largest-growing
  industries in Central Minnesota
  
• Retail Trade comprises 12.6 of total countywide
  jobs (6,536 jobs)
  
• 65 of Retail Trade jobs are anchored in Willmar
  (2,432 jobs 37.2) and Hutchinson (1,820 jobs
  27.9)
  
• Retail Trade lost -87 jobs from 2000 to 2003
• One of the lowest-paying industries, at 335 avg.
  wage
  
• Building Materials Stores added 159 jobs
• Food Beverage Stores dropped -151 jobs
• Retail Trade also lost -32 establishments

56
Region 7E Economy

• Region 7E had 3,532 firms 45,819 jobs paying
  1.25 billion in 2003
  
• 81.2 of employment in Region 7E is in
  services-producing industries
  
• State of Minnesota 19.3 of jobs in
  goods-producing
  
• 26.8 of employment in Region 7E is in the Public
  or Government sector
  
• State of Minnesota 14.4 of jobs in the public
  sector
  
• Region 7E gained a net of 2,443 jobs and 150
  firms from 2000 to 2003

57
Region 7E Healthcare Services

• Healthcare and Social Assistance is the largest
  employing non-ag industry in Region 7E, with
  19.4 of total region jobs (8,907 jobs)
  
• That was a 13.7 increase since 2000, which is
  1,100 more jobs
  
• Healthcare employment was at Hospitals (3,125
  jobs), Ambulatory Healthcare Services (1,231
  jobs), Nursing Residential Care Facilities
  (4,021 jobs), and Social Assistance (698 jobs)
• Healthcare averaged 40.3 employees per site
  larger employers
  
• Retail Trade is the next largest employing non-ag
  industry in Region 7E, with 13.1 of total region
  jobs (6,017 jobs)
  
• That was a 2.8 increase since 2000, which is
  1,100 more jobs
  
• Among the lowest-paying industries at 357
  average weekly wages
  
• Food Beverage Stores (1,400 jobs) and General
  Merch. Stores (1,005 jobs)
  
• Led to associated growth in Accommodation and
  Food Services, jumping up to 3,974 jobs in 2003
  
• Also has low wages (184 aww)

58
Region 7E Differences

• Much smaller concentration of Manufacturing
  firms, makes up 11.4 of total regional jobs
  (5,201 jobs) with 658 avg. wage
  
• Manufacturing lost -1,059 jobs from 2000 to 2003
• Average of only 20 employees per site smaller
  companies
  
• Plastics Rubber Product Mfg. was competitively
  located Food Manufacturing was almost
  non-existent (290 jobs)
  
• The largest employing specialty was Fabricated
  Metal Product Manufacturing (1,356 jobs),
  although it also lost nearly -200 jobs
  
• Demographic growth also led to growth in
  Educational Services (4,373 jobs)
  
• 53.3 employees per site the largest average
  size
  
• Added 592 jobs from 2000 to 2003
• Public Administration had 3,507 jobs in 2003,
  significantly more concentrated than other
  regions

59
Region 7W Economy

• Region 7W had 9,416 firms 144,061 jobs paying
  4.37 billion in 2003
  
• 75 of employment in Region 7W is in
  services-producing industries 25 of employment
  in goods-producing domain
  
• State of Minnesota 19.3 of jobs in
  goods-producing
  
• 86.1 of employment in Region 7W is in the
  private sector
  
• State of Minnesota 85.6 of jobs in the private
  sector
  
• Region 7W gained a net of 5,996 jobs and 755
  firms from 2000 to 2003
  
• With Stearns and Benton Counties included,
  Region 7W is by far the largest employing
  region
  
• 37 of the region jobs are in Sherburne and
  Wright
  
• Wright added 3,346 jobs Sherburne added 2,315

60
Region 7W Blue Collar Economy

• Manufacturing is the largest employing non-ag
  industry in Region 7W, with 16.8 of total
  regional jobs (24,185 jobs)
  
• Statewide, manufacturing comprises 13.4 of total
  jobs, and lost close to-40,000 jobs during the
  recession (Q2-2001 to Q2-2004)
  
• Region 7W lost just over 1,200 manufacturing jobs
  from 2001-2004
  
• Food Manufacturing added 88 jobs (3,422 jobs)
• Fabricated Metal Product Mfg. was the largest
  specialty (3,473 jobs)
  
• Wood Product Mfg. gained just under 200 jobs
• Furniture Related Product Mfg. added 117 jobs
• Sherburne and Wright had 31 of Region 7Ws
  manufacturing employment
  
• Sherburne County 2,749 jobs
• Lost -210 jobs from 2000 to 2003
• Wright County 4,731 jobs
• Lost -369 jobs from 2000 to 2003

61
Region 7W Services

• Retail Trade is the next largest employing
  industry in Region 7W, with 15.1 of total jobs
  (21,803 jobs)
  
• That was a -4.1 decrease since 2000, which is
  -943 less jobs
  
• Largest decreases in Nonstore Retailers (Stearns
  Benton)
  
• In contrast, Sherburne added 550 retail jobs
  Wright added 769 jobs
  
• Led to associated growth in Accommodation and
  Food Services, gaining 974 new jobs to 11,830
  jobs total
  
• Also has low wages (185 aww)
• Healthcare Social Assistance was the third
  largest industry, with 17,800 jobs added 2,475
  jobs from 2000
  
• 6,115 jobs at Hospitals 4,873 jobs at Ambulatory
  Healthcare Services 4,559 jobs at Nursing Care
  3,001 jobs at Social Asst.
  
• Averaged only 27 employees per site

62
A Growing Services Economy

• Demographic growth also led to growth in
  Educational Services (12,912 jobs), added 1,719
  jobs from 2000 to 2003
  
• 72.1 employees per site the second largest
  average size
  
• Added 592 jobs from 2000 to 2003
• Construction payrolls jumped nearly 25 between
  2000 and 2003
  
• Specialty Trade Contractors (1,413 jobs and 189
  firms)
  
• 1,058 of those jobs were added in Sherburne
  Wright County
  
• Construction of Buildings (563 jobs)
• 212 of those jobs were added in Sherburne
  Wright County
  
• Heavy Civil Engineering Construction (215
  jobs)
  
• 228 of those jobs were added in Sherburne
  Wright County
  
• Construction is one of the fastest growing
  industries in Central Minnesota demand for more
  workers is high

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DEED Business Services List
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A Trade-Off?

• Longevity and Stability
• Central Minnesota has a large number of
  businesses that have been operating for more than
  30 years
  
• Vitality and Growth
• Central Minnesota has a growing number of new
  businesses created in the last five years
  
• We need different industries not just more of the
  same
  
• Central MN relies on many older firms in older
  industries
  
• Competition in these mature industries has
  already squeezed out the windfall profits
  
• That leaves thin margin firms in thin margin
  industries
  

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Thin Margin vs. High Tech

• Thin margin firms are more susceptible to
• Minimal investment in research and development
• Infrequent investment in new capital equipment
• Lean staff salaries
• High sensitivity to tax environment
• Vulnerable to merger and acquisition
• High Tech Industries tend to have fat margins
• Because of the high-value added production in
  high-tech industries, and the greater demand for
  high-skilled labor, these industries compensate
  their employees well.
• America's High-Tech Economy Growth Development,
  and Risks for Metropolitan Areas Ross DeVol,
  Perry Wong, John Catapano, and Greg Robitshek
  The Milkin Institute

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Brainstorming about Industries

68
Questions?

• Cameron Macht
• Regional Analysis Outreach Unit
• 320-231-5174 ext. 7535
• cameron.macht_at_state.mn.us

• Dept. of Employment Economic Development
• LMI Analyst HelpLine
• 651/282-2714
• DEED Publications
• 651/296-6545
• DEED LMI Web Site
• www.deed.state.mn.us/lmi/