Central Minnesota is a manufacturing stronghold, with several global manufacturing firms operating there.
The region is especially well known for its expertise in food processing, printing, furniture manufacturing, appliances, machinery and heavy equipment manufacturing.
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3/13/2019 4:00:00 PM
Normally, Local Look focuses on the highlights of Central Minnesota’s economy, but it is also important to understand areas of the economy experiencing job losses during this extended economic expansion. While declining employment was common during the recession from 2008 to 2010, most industries have recovered. However, a handful of industries have remained in decline, or are continuing a long-term downward employment trend.
Fortunately for Central Minnesota, the vast majority of the 80 detailed industry sectors have experienced job growth in recent years. A smaller set of industries has seen greater employment fluctuations up and down since the recovery, but the trendlines are still pointing up. Unfortunately, seven industries exhibit consistent, long-term job losses (Table 1).
Some reasons a particular industry may be in consistent decline include:
While the reason(s) for decline in a particular industry varies, so does the implication to the local economy. It means fewer jobs in certain sectors, but it can also mean that the remaining jobs are different. For instance, if an industry is beginning to adopt new technologies or automation which leads to firms needing fewer workers, it’s likely that the remaining employees and future recruits will need to possess different skills.
To that point, two of the declining industries saw wages increase faster than the overall economy in Central Minnesota during the 2010 to 2017 period: electrical equipment, appliance, and component manufacturing, and the furniture and furnishing manufacturing industry.
Declining industries are nothing to take lightly; however, the situation is far from dire. The seven industries in the table represent a small fraction – roughly 5 percent – of Central Minnesota’s economy. Losses in the declining industries from 2010 to 2017 were more than offset by job gains made in other industries. To provide perspective, the specialty trade contractors industry gained 3,354 jobs during the same period, meaning that industry by itself created almost twice as many jobs as the seven declining industries lost.
One takeaway: Our economy is constantly evolving, so industries that once provided ample employment opportunities might not continue to be major job providers in the future. Job seekers should consider why there are fewer jobs in a particular industry – does the change mean that there are still opportunities, but with different skill requirements?
Contact Luke Greiner at 320-308-5378.