changing demographics in southwest...

Regional Analysis & Outreach UnitLabor Market Information Office

Changing Demographics in Southwest Minnesota

Cameron MachtRegional Analyst,

Southwest MNDept. of Employment and

Economic Developmentwww.deed.state.mn.us/lmi/

320-231-5174 ext. 7535


About DEED’s Regional AnalystsCollaborate with regional stakeholders on researchExtend access to DEED reports and statisticsConduct presentations and training on the local andregional economy & labor market Original research and analysis intended to answer “the tough questions”Five regional analystsstationed across the stateWe’re here to help you!We’re here to help you!


Presentation AgendaWorkforce Development in Southwest Minnesota

Demographic ChangesDeclining PopulationsGrowing Old GracefullyIn- and Out-Migration PatternsIncreasing DiversityWhat Does That Mean For Your Business?

Economic ChangesSalary SurveyLargest IndustriesGrowing/Declining Industries

Conclusions and Questions


“People are born, they move, they die”John Fraser Hart, Professor of Geography at the Univ. of Minnesota,explains population change this waySome areas of Minnesota are growing rapidly, other areas are holding their own, and others are declining

What’s happening?What’s happening?


Moving From Rural to UrbanNationwide trend: U.S. population was 75%75% urbanurban in 1990; it jumped to 79% urban79% urban in 2000Statewide trend: MN population was 69.8% urban69.8% urban in 1990; it crept up to 70.9% urban70.9% urban in 2000

Percent of Population Urban and Rural, 1990-2000

0%10%20%30%40%50%60%70%80%90%

100%

Big Stone CountyChippewa County

Cottonwood CountyJackson County

Kandiyohi CountyLac qui Parle County

Lincoln CountyLyon County

McLeod CountyMeeker CountyMurray C

ountyNobles C

ountyPipes tone CountyRedwood County

Renville County

Rock CountySw ift C

ounty

Yellow Medicine County

M innesotaUnited States

Urban: 1990 Rural: 1990

Urban: 2000 Rural: 2000


Percent Population Change, 1990 to 2000

Sour

ce:

1990

& 2

000

Cen

sus

Slow but steady declineOnly Lyon (2.6%) & Nobles (3.7%)saw growth from 1990 to 2000

Cottonwood -4.2%Jackson -3.5%Lincoln -6.7%Murray -5.1%Pipestone -5.7%Redwood -2.5%Rock -0.9%

ZERO Southwest counties grew from 2000 to 2003


25,000

50,000

75,000

100,000

125,000

150,000

1960 1970 1980 1990 2000 2002

Population Change, 1960 - 2002

Region 6W Region 6E Region 8

Demographic ChangesRegion 6E has seen steady growth: +20.1% increase in +20.1% increase in populationpopulation since 1960

6.0% increase6.0% increase from 1990 to 20001.0%1.0% from 2000 to 2003 (+1,169)(+1,169)

Region 6W has seen a steady decline: --27.6% decrease in 27.6% decrease in populationpopulation since 1960

--1.6% decrease1.6% decrease from 1990 to 2000--2.7%2.7% from 2000 to 2003 ((--1,350)1,350)

Region 8 has seen a steady decline: --18.5% decrease in 18.5% decrease in populationpopulation since 1960

--1.3% decrease1.3% decrease from 1990 to 2000--2.0%2.0% from 2000 to 2003 ((--2,422)2,422)

2003

2003


Percentage of the Population Age 65 and Over

Ahead of our time . . .By 2030, 20%20% of the MN population is projected to be aged 65 years & over…

Minnesota = 12.1%12.1%Healthcare crisis and worker shortages are making newsThis labor force change will have a major impact on the economyS

ourc

e: 2

000

Cen

sus


So the Population is Growing… OlderRegion 6W is already there – 20.7%20.7% were 65 years and over in 2000; projected to reach 30.2%30.2% by 2030 – almost 1 in every 3 people!Region 8 was 19.1%19.1% in 2000; projected to reach 26.3%26.3% in 2030Region 6E was 15.6%15.6% in 2000; projected to reach 24.4%24.4% in 2030

2000 2005 2010 2015 2020 2025 20300%

5%

10%

15%

20%

25%

30%

35%

Percentage of Population Aged 65 Years and Over in Regions 6E, 8 & 6W, 2000 - 2030

MinnesotaRegion 6ERegion 8Region 6W

Baby Boomers begin reaching retirement age in 2011

Source: Minnesota Planning


Population Projections, 2000-2030

2.5%-0.6%124,700123,000121,000121,717Total Population

Percent ChangeSouthwest Minnesota Projected Population Changes

41.4%-4.3%32,80026,50022,20023,191Age 65 plus19.6%34.9%13,30017,00015,00011,12155 to 64 years-9.9%11.4%13,90013,30017,20015,43445 to 54 years-19.0%-23.6%14,20014,10013,40017,53535 to 44 years-1.4%7.8%12,80013,90014,00012,98525 to 34 years-11.4%-4.1%14,50014,40015,70016,36315 to 24 years-7.5%-6.3%23,20023,80023,50025,0880 to 14 years

2000 - 20302000 - 20102030202020102000

Much of the region’s population growth is projected to be in theage groups from 55 years and older

Significant declines in younger and “prime working” age groups


Migration Patterns – Losing Our Youth?Net Migration, Age 30 to 44Net Migration, Age 15 to 24

Sour

ce:

1990

& 2

000

Cen

sus


Demography and the EconomyThese regional demographic trends impact the local economyA long-term tightening of the labor force in our region is predictedThe loss of the young adult population leads to a different kind of labor market

Right now, there is slower growth in entry-level workersThat leaves an available pool of experienced, higher-skilled workersBut experienced workers typically demand higher wages, or perhaps better health insurance or more schedule flexibility…

In-migration has become much more important to the local labor force, requiring new workers to fill in available jobsTherefore, non-traditional students and continuing education are areas of potential future growth for higher education…What does that mean for businesses?


What Does It Mean For You?With fewer mid-career and less growth in new entrants, employers will probably be looking for:

Productivity increasesWorkforce development RecruitmentRelocation

What comes first, the people or the jobs?Population and income growth generates demand for services

If people are retiring or moving away, who will fill the jobs?Labor force participation rates are decreasing for:

For males aged 25 to 54, Labor force participation rates decreased from 93.9% in 1990 to 91.3% in 2000


A Job Bust from the Baby Boom?Labor force participation rates are increasing for:

Women of all agesFor females aged 16 years and over, Labor force participation rates grew from 62.5% in 1990 to 66.0% in 200066.0% in 2000 (Minnesota ranks #1 in the U.S.)

Older adultsFor males aged 65 to 69, Labor force participation rates grew from 28.7% in 1990 to 33.2% in 200033.2% in 2000; females grew 18.2% to 24.0%24.0%

TeenagersFor males aged 16 to 19, Labor force participation grew from 59.7% in 1990 to 60.3% in 200060.3% in 2000; females grew from 61.0% to 63.9%63.9%


Not Necessarily…The total labor force is projected to grow 2.8% through 2030

Female labor force will grow 5.9%5.9% in Southwest Minnesota65 years + labor force will grow 108.3%108.3%25-44 years labor force will decline --11.9%11.9%

108.3%12.6%7,6007,1406,1104,9304,1103,7103,649Age 65 plus6.4%26.3%22,85023,26024,94026,71027,14025,09021,484Age 45-64

-11.9%-11.1%24,19024,94025,07024,67024,41025,03027,446Age 25-44-3.0%1.0%10,31010,0209,96010,31010,73011,18010,624Age 16-245.9%7.0%31,15031,22031,51031,71031,47030,54029,423Female labor force

0.1%3.3%33,82034,14034,58034,94034,91034,51033,780Male labor force2.8%5.0%64,96065,34066,09066,65066,39065,06063,203Total labor force

2000 -2030

2000 -20102030202520202015201020052000

Percent ChangeSouthwest Minnesota Projected Labor Force Changes(Projections from the State Demographer – Minnesota Planning)


Minority Populations, 2000S

ourc

e: 2

000

Cen

sus


Increasing Diversity

100%90,359100%31,358100%121,717Total Population

2.8%2,5395.9%1,8473.6%4,386Hispanic or Latino

0.5%4932.0%6180.9%1,111Two or More Races

1.5%1,3873.1%9701.9%2,357Other Race

0.0%350.0%120.0%47Native Hawaiian and Other Pacific Islander

1.2%1,0612.4%7381.5%1,799Asian

0.6%5281.4%4270.8%955American Indian and Alaska Native

0.5%4840.9%2710.6%755Black or African American

95.6%86,37190.3%28,32294.2%114,693White

PctNumberPctNumberPctNumber

18 & OverUnder 18All Persons2000 Population by One Race


Growing Faster in Regional CentersNobles, Lyon, and Redwood Counties will see the biggest increases in labor force

Worthington, Marshall, and Redwood FallsMurray and Pipestone Counties will see declines

1.4% 2.9% 2.0%

5.5%

-8.4%

8.5%

-9.4%

6.0%

2.7%

-10%-8%-6%-4%-2%0%2%4%6%8%

10%

Cottonw ood Jackson Lincoln Ly on Murray Nobles Pipestone Redw ood Rock

Percent Change in Projected Labor Force, 2000 - 2030


Changing Diversity (Example: Marshall)91.4% white – slightly lower percentage than Lyon & Southwest, slightly higher than MinnesotaBlack or African American and Hispanic populations increased fastest; Asian and American Indian populations growing faster inother parts of the county

-0.9% -2.6%

522.8%472.7%

7.3% 27.0%

120.0%

252.5% 262.0%321.9%

366.0% 371.5%

-50%

50%

150%

250%

350%

450%

550%

White Black or AfricanAmerican

American Indianand Alaska Native

Asian Some other race Hispanic or Latino(of any race)

Percent of Population Growth by Race, 1990-2000 MarshallLyon County


Wages are Growing…SlowlyMinnesota Salary Survey is based on a rolling survey of 22,000 employersUpdated quarterly and annually for the state, regions, and MSAs

Second Quarter 2004Distribution stats for 10th, 25th, 50th, 75th, and 90th percentilesSouthwest Minnesota typically earns less than 80 percent of the metro wage www.deed.state.mn.us/lmi/tools/oes/


Wage Comparison Analysis

15,59098.0%$7.83$7.67Food Prep & Serving Related Occupations

8,62080.8%$23.59$19.06Healthcare Practitioners & Technical Occs

2,980109.7%$14.38$15.77Protective Service Occupations5,83090.4%$11.52$10.41Healthcare Support Occupations

1,08074.5%$18.54$13.82Arts, Design, Ent., Sports, & Media Occs12,060101.6%$18.77$19.07Education, Training & Library Occupations2,87093.5%$15.97$14.93Community & Social Service Occupations5,46086.0%$24.06$20.68Business & Financial Oper. Occupations6,76077.7%$38.59$29.97Management Occupations

167,38081.7%$15.07$12.31Total, All Occupations

SW Region Employment

% of MN Wage

State of Minnesota

SW Region

Occupational Group

Wage Comparison: Major Occupational Groups


Wage Comparison Analysis

Source: DEED Minnesota Salary Survey, Second Quarter 2004

5,63081.2%$18.12$14.71Installation, Maint. & Repair Occupations

14,15088.8%$13.25$11.77Transportation & Material Moving Occs21,74090.0%$13.94$12.55Production Occupations

6,67071.7%$21.70$15.56Construction & Extraction Occupations1,14097.4%$11.09$10.80Farming, Fishing, & Forestry Occupations24,79083.1%$13.81$11.47Office & Administrative Support Occs17,24079.4%$11.19$8.89Sales & Related Occupations3,87097.6%$9.58$9.35Personal Care & Service Occupations5,22092.5%$10.24$9.47Building & Grounds Cleaning & Maint. Occs

SW Region Employment

% of MN Wage

State of Minnesota

SW Region

Occupational Group

Wage Comparison: Major Occupational Groups


The Loyalty EffectResearch shows that Americans are changing jobs and careers more frequently, regardless of the economyThe median number of years that wage and salary workers had been with their current employer was 3.7 3.7 yearsyears in January 2002

Despite these trends to the contrary, workers in Southwest Minnesota continue to display a remarkable amount of loyalty to their employersAccording to a recent Labor Force Assessment conducted in Regions 6E, 6W, and 8, the median employee tenure was set almost twice as high, at 7 years7 years; average employee tenure was close to 12 years!12 years!

0

2

4

6

8

10

12

Year

s

Median Employment Tenure(years)

Average Employment Tenure(years)

Employment Tenure, in Years Region 6E Region 6W

Region 8 United States


Show Me The Money! Region 890% of respondents rated an increase in pay as important* with 64% of respondents rating it as very important87% of respondents rated an increase in job benefits as important* with 64% of respondents rating it as very important80% of respondents rated better utilization of skills as important79% of respondents rated more job security as important


What Money Can’t Buy…93% of working residents in Region 8 were employed within their region

4% are employed in the bordering counties of South Dakota and Iowa75% had one-way commute times under 15 minutes93% had one-way commute times under 30 minutesOnly 3% had one-way commute times of 46 minutes or more

65%

24%

5%

6%

74%

19%

4%3%

45%

28%

14%

13%

75%

18%

4%3%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Region 6E Region 6W Region 7W Region 8

One-Way Commuting Times, 2001 LFA0 to 15 minutes 16 to 30 minutes 31 to 45 minutes 46 minutes or more


Commuting Patterns

Nobles County

Lyon County


Southwest MN EconomyRegion 8 had 4,001 firms4,001 firms & 52,906 jobs52,906 jobs paying $1.34 billion$1.34 billion in 2003

75.6%75.6% of employment in Region 8 is in services-producing industries; 24.4%24.4% of jobs are in the goods-producing domain (state = 19.3%)78.9%78.9% of employment in Region 8 is in the Private sector; 21.1%21.1% of jobs are in the Public or Government sector (state = 14.4%)

Manufacturing is the largest employing non-ag industry in Region 8, with 17.8%17.8% of total regional jobs (9,421 jobs9,421 jobs)

Statewide, manufacturing lost just over --50,00050,000 jobs during the recessionRegion 8 lost --1,600 manufacturing jobs 1,600 manufacturing jobs from 2000 to 2003Food Manufacturing lost --1,225 jobs1,225 jobs; but is still the largest employing manufacturing specialty (4,339 jobs4,339 jobs)Computer & Electronic Product Mfg. lost --460 jobs460 jobsMachinery Mfg. gained +316 jobs +316 jobs (highest-paying)


Southwest MN EconomyHealthcare & Social Assistance is the next largest employing non-ag industry in Region 8, with 16%16% of total regional jobs (8,457 jobs8,457 jobs)

Statewide, healthcare & social assistance added just over 38,500 jobs from 2000-2003 (sometimes called “recession-proof”)Region 8 added 1,171 healthcare & social assistance jobs1,171 healthcare & social assistance jobs1,145 jobs 1,145 jobs at regional Hospitals; 2,205 jobs ; 2,205 jobs at Ambulatory Healthcare Services (clinics, doctor’s offices, dentists, chiropractors, etc.)3,386 jobs3,386 jobs at Nursing & Residential Care FacilitiesHealthcare is projected to be the largest-growing industry in Southwest Minnesota through 2010Most in-demand occupations include: Nursing Aides,Registered Nurses, Licensed Practical Nurses, Home Health Aides, Health Info Technicians, etc.


Largest Industries… Region 8

NA1,585NAOther Services, Ex. Public Admin.-192,1752,194Finance and Insurance+662,3812,315Construction-1492,9283,077Wholesale Trade-202,9392,959Public Administration-8883,4554,343Accommodation & Food Services+694,6184,549Educational Services-496,5636,612Retail Trade

+1,1718,4577,286Health Care and Social Assistance-1,6009,42111,021Manufacturing+26052,90652,646Total, All Industries

Employment Change from

2000-2003

Average Employment

in 2003

Average Employment

in 2000

Largest Industries by Employment, 2003Southwest Minnesota – Region 8


Fastest Growing Industries

+7.9%1,0901,010Specialty Trade Contractors+13.2%791699Wood Product Manufacturing+13.9%417366Repair & Maintenance+14.6%949828Truck Transportation+21.8%1,7641,448Machinery Manufacturing+25.5%752599Animal Production+26.6%219173Agriculture Support Activities+63.9%5936Plastics & Rubber Product Mfg.+67.2%2,2051,319Ambulatory Healthcare Services+80.5%231128Chemical Manufacturing+289.4%36694Nonstore Retailers


2000-2003

Average Employment

in 2003

Average Employment

in 2000

Fastest Growing Industries by EmploymentSouthwest Minnesota – Region 8


Largest Declining Industries

-31372403Publishing Industries-312,0692,100Executive, Legislative, & General Government-341,0221,056Gasoline Stations-48798846Heavy & Civil Engineering Construction-50310360Transit & Ground Passenger Transport-61208269Clothing & Clothing Accessories Stores-791,2021,281General Merchandise Stores-87687774Motor Vehicle & Parts Dealers-460428888Computer & Electronic Product Mfg.-9284131,341Accommodation

-1,2254,3395,564Food Manufacturing


2000-2003

Average Employment

in 2003

Average Employment

in 2000

Largest Declining Industries by Employ-ment Southwest Minnesota – Region 8


ConclusionsPeople are born, they move, and they die…The population in Southwest Minnesota is growing… olderThe Baby Boom will not necessarily create a Job Bust

Labor force participation rates are increasing for women, older adults, and teenagers; but also are bolstered by in-migration

Workers in Southwest Minnesota are more affordable than metro areas, and they show remarkable loyalty to employers

Many would change jobs if offered an increase in payCommute times are much shorter than in metro areas

The largest industries are Manufacturing, Healthcare & Social Assistance, Educational Services, Retail Trade, & Construction

Manufacturing is declining overall; but various specialties are still growingHealthcare & Social Services are increasing; aging population ensures demandAgriculture is still the foundation of the local and regional economy


Questions?Cameron Macht

Regional Analysis & Outreach Unit320-231-5174 ext. [email protected]

Dept. of Employment & Economic DevelopmentLMI Analyst HelpLine

651/282-2714DEED Publications

651/296-6545DEED LMI Web Site

www.deed.state.mn.us/lmi/

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