Understanding Oregon’s Economic Situation:

What Lies Ahead for the Future Workforce

OAVSNP

Winter 2009 Conference

February 20, 2009

Overview

• Current economic conditions

• Where are the jobs today and tomorrow?

• What skills and training do job seekers need?

• How is the workplace changing?

1/20/09 News Release Summary

• Unemployment rate rose from 8.0 percent in November to 9.0 percent in December.• US rate 7.2 percent.

• Employment down almost 47,000 since pre-recession peak (February 2008).

Unemployment rates have jumped dramatically since June.

Seasonally Adjusted Unemployment Rates, 1998 to Present

3.0

4.0

5.0

6.0

7.0

8.0

9.0

10.0

Jan-

98

Jul-9

8

Jan-

99

Jul-9

9

Jan-

00

Jul-0

0

Jan-

01

Jul-0

1

Jan-

02

Jul-0

2

Jan-

03

Jul-0

3

Jan-

04

Jul-0

4

Jan-

05

Jul-0

5

Jan-

06

Jul-0

6

Jan-

07

Jul-0

7

Jan-

08

Jul-0

8

U.S. Oregon

In December, Oregon had the

6th highest unemployment

rate in the nation.

Lets put today’s situation in perspective, based on historical experience.

Oregon's Seasonally Adjusted Unemployment Rate -- the Long-Term View

0

2

4

6

8

10

12

14

Jan-76

Jan-78

Jan-80

Jan-82

Jan-84

Jan-86

Jan-88

Jan-90

Jan-92

Jan-94

Jan-96

Jan-98

Jan-00

Jan-02

Jan-04

Jan-06

Jan-08

Pe

rce

nt

of

La

bo

r F

orc

e

12.1% in November 1982

9.0% in December 2008

We’re now in a phase of big job losses, with employment declines averaging almost 10,000 per month since October.

Down eight of ten last months.

Seasonally Adjusted Employment in OregonTotal Nonfarm Payroll: 1990 - 2008

1,200,000

1,400,000

1,600,000

1,800,000

1990 1992 1994 1996 1998 2000 2002 2004 2006 2008

Em

plo

yme

nt

Employment down 46,700 from pre-recession peak in February 2008

Recession hitting all sectors

• Major retailers such as Circuit City closing• Health care - OHSU, central Oregon hospitals cutting back• Nike• Verizon Wireless• Red Cross• Car dealerships• Education• Residential building companies filing bankruptcy• State agencies laying off

Industries showing big losses include retail trade and, in recent months, leisure and hospitality.

Seasonally Adjusted Employment in OregonRetail Trade: 1997 - 2008

170,000

180,000

190,000

200,000

210,000

1998 2000 2002 2004 2006

Em

plo

yme

nt

Seasonally Adjusted Employment in OregonLeisure and Hospitality: 1990 - 2008

100,000

120,000

140,000

160,000

180,000

200,000

1990 1992 1994 1996 1998 2000 2002 2004 2006

Em

plo

yme

nt

Health care is not recession-proof, though we just started seeing cuts in early February

Seasonally Adjusted Employment in OregonHealth and Social Services: 1997 - 2008

120,000

140,000

160,000

180,000

200,000

1998 2000 2002 2004 2006

Em

plo

yme

nt

So to summarize the Recession in one graph …

Construction and manufacturing have led Oregon's job losses.

-20,000

-15,000

-10,000

-5,000

0Con

stru

ction

Man

ufac

turin

g

Retail

trad

e

Profe

ssio

nal a

nd B

usine

ss S

ervic

es

Leisu

re a

nd H

ospi

tality

Financ

ial A

ctivi

ties

Gover

nmen

t

Natur

al R

esou

rces

and

Min

ing

Who

lesal

e tra

de

Job

s L

ost

...

Job loss from pre-recession peak to December 2008.

Where do we go from here?

One good thing about recessions…

… they never last forever

The state forecast suggest we don’t bottom out until at least 3Q09.

Quarterly Employment, History and ForecastOregon: 1998 - 2015

1,400,000

1,600,000

1,800,000

2,000,000

1998:1 2000:1 2002:1 2004:1 2006:1 2008:1 2010:1 2012:1 2014:1

To

tal N

on

farm

Pa

yro

ll E

mp

loym

en

t

Source: Office of Economic Analysis, Department of Administrative ServicesDecember 2008

Okay, enough of the recession. There are some broader workforce issues we have to also keep

focused on.

1. Even during a recession, there are many vacancies. But, competition can be fierce.

Registered Nurses and Farm Workers Vie for First PlaceOccupations with Most Vacancies, Spring 2008

0 500 1,000 1,500 2,000 2,500 3,000

Combined Food Preparation and Serving Workers, Including Fast Food

Stock Clerks and Order Fillers

Maids and Housekeeping Cleaners

Personal and Home Care Aides

Food Preparation Workers

Laborers and Freight, Stock, and Material Movers, Hand

Customer Service Representatives

Cooks, Restaurant

Packers and Packagers, Hand

Cashiers

Waiters and Waitresses

Nursing Aides, Orderlies, and Attendants

Retail Salespersons

Farmworkers and Laborers, Crop, Nursery, and Greenhouse

Registered Nurses

Number of Vacancies

Total openings for all occupations: 47,888

In May 2008, almost 48,000 vacancies spread across 500 occupations.

Broader workforce issues…

2. No one’s talking about baby boom retirements right now… but thoughtful planning is still needed.

More vacancies will be created by “replacements” (think baby boomers) than by economic growth.

Oregon Projected Employment Openings, 2006-2016

0 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000

Nonclassifiable

Farming, Fishing, and Forestry

Installation, Maintenance, and Repair

Construction and Extraction

Production

Transportation and Material Moving

Management, Business, and Financial

Health Care

Sales and Related

Professional and Related

Office and Administrative Support

Service

Growth Openings

Replacement Openings

250,000 growth openings

450,000 replacement openings

Broader workforce issues…

3. Even with those retirements, Oregon will probably have enough workers… but will they have the right training and skills?

All occupational groups are projected to add jobs…

Oregon Employment Change by Occupational Group, 2006-2016

0 10,000 20,000 30,000 40,000 50,000 60,000

Nonclassifiable

Farming, Fishing, and Forestry

Installation, Maintenance, and Repair

Production

Construction and Extraction

Transportation and Material Moving

Management, Business, and Financial

Sales and Related

Health Care

Professional and Related

Office and Administrative Support

Service

Important Notes

Relatively low-wage/low skill occupations add the most jobs.

Professional and health care significantly contribute to high-wage job growth.

Blue-collar jobs also growing.

Nearly three-fourths of Oregon’s projected job openings will not require post-secondary education, based on the minimum educational requirement for each job.

Oregon Job Openings -- Growth and Replacement -- by Required Training, 2006-2016

Associate3.9%

Related work experience

6.4%

Moderate-term on-the-job

training15.9%

Short-term on-the-job training

44.6%

Long-term on-the-job training

6.6%

Postsecondary training

7.9%

Bachelor's13.3%

Advanced degree3.4%

Not all High-wage, high-demand jobs require higher education

• Occupations vary from truck drivers to mechanical drafters to medical transcriptionists

• Some require apprenticeships or higher ability levels

• Many are on-the-job training

Low-skilled jobs are not no-skilled jobs.

• May not need high level credentials to apply for low-skilled jobs, but they must possess the requisite skills to succeed in their jobs.

• Appropriate workplace behavior and the ability to follow instructions are important

• Communication • Interpersonal develop • Teamwork• Leadership • Problem solving• Initiative and enterprise • Planning and organizing

Common skills sought by employers

• Self management • Accuracy • Ability to learn • Flexibility • Creativity • Technology and Computers• Commonsense• Reliability

Keep in mind that…

• Low skilled jobs offer promotional opportunities.

• Firms also construct pipelines of appropriately skilled workers by hiring entry-level workers with skills needed in the position above entry level.

• But, workers should be willing and able to expand their skill sets to the best of their ability.

Where is the best place to look for a job today?

• All industry sectors are down

• Very competitive

• Some who are eligible for retirement are not retiring yet

• Lots of experienced workers competing with youth

Where is the best place to look for a job tomorrow?

• Employment projections are long-term

• Look at occupations with higher projected job openings in our data

• Latest buzz is about Green Jobs

• Will take time for some sectors to come back

How is today’s workplace different?

Four Generations in the Work Place

• Traditionalists – born prior to1946

• Baby Boomers – 1946-1964

• Generation Xers – 1965-1980

• Millenials – 1981 - 1995

The world of work is evolving.

Today’s workers need to:

• realize they will be responsible for their own career development.

• realign expectations to include continuous learning over a lifetime.

• find out what the impact of technology means to their duties and tasks and to do something about it.

• no longer expect the employer to prepare them for changing duties.

• realize they need more than a résumé to market themselves. • realize there are more options for rewards than money and

promotions elder care, day care, flex hours, vacation and training time. leisure time, training opportunities.

To Summarize…

• Today – seems like all we hear is bad news

• But, things will get better. We still need to plan for tomorrow.

• The workplace and the workers are changing. We all need to keep pace with those changes.

Just for fun… where do the happiest people work?

Clergy 67%Firefighters 57%Travel agents 57%Architects 54%Misc. mechanical and repair 54%Special education teachers 53%Actors and directors 51%Science technicians 51%Airline pilots and navigators 49%Industrial engineers 48%

Source: "Job Satisfaction in the United States”, University of Chicago

Please visit our web site – www.QualityInfo.org – for more information

about Oregon’s economy and workforce.

Brenda Turner, Occupational EconomistWorkforce and Economic Research

Oregon Employment DepartmentBrenda.P.Turner@state.or.us

(503) 947-1233