The nation continues to endure a problematic skills gap in its resurging manufacturing sector – and Minnesota is no exception.
But the state has continued to gradually close the gap in recent years, most notably through its annual Manufacturers Week, a multiple-day event that encourages manufacturers to host a free plant tour.
Rachel Vilsack, Regional Analysis and Outreach Manager at the Minnesota Department of Employment and Economic Development (DEED), says the goal of the event – slated to be held Oct. 20-26 – is to bring company and business leaders together to highlight the importance of manufacturing and encourage a greater number of Minnesotans to consider manufacturing as a legitimate, high-paying, long-term career option.
“We have a campaign that exists in Minnesota called Dream It. Do It., which is going to be coordinating a lot of these open houses, so that people can see the exciting job opportunities in the manufacturing sector,” Vilsack tells Industry Today, adding that a number of organizations, including DEED, are promoting the event.
And there are plenty of manufacturing jobs, she says, particularly outside the Twin Cities region.
One in seven jobs in Minnesota is in manufacturing, according to DEED. Across the state, manufacturing accounts for between 8 and 34 percent of total employment, depending on the region.
The average annual wage is more than $58,700, Vilsack says, or about 20 percent higher than the average wage for all industries. Wages in manufacturing accounted for 16 percent of all private sector wages paid in Minnesota in 2012.
“The manufacturing sector has the second largest payroll of any business sector in the state, about $18 billion in 2012 wages,” Vilsack says. “We’ve seen manufacturing employment grow in Minnesota by about 4.6 percent between 2010 and 2012.”
She adds, “We had about 305,600 jobs statewide in manufacturing in 2012. That’s 13 percent of private sector jobs in the state. Manufacturing ranks second in terms of the number of jobs. Only healthcare is larger.”
Each manufacturing job supports another 1.9 jobs elsewhere in the economy through supplier purchases and employee spending, DEED says. Meanwhile, manufacturing exports brought in $18.4 billion into the Minnesota economy in 2011.
And the state’s sunny manufacturing climate is expected to get even sunnier, Vilsack says. Northwest Minnesota, for instance, is projected to see a 17 percent increase in the number of manufacturing jobs between 2010 and 2020. And a number of smaller sectors, like aerospace parts manufacturing in the state’s northeastern region, is expected to see double-digit increases in jobs over that same time span.
Still, Minnesota recorded over 5,300 job openings in the manufacturing sector in spring 2013, and some manufacturers reportedly had a challenging time filling these positions due to the nation’s lack of experienced, qualified candidates. The dilemma has escalated now that manufacturing has morphed from into a high-tech, automated sector in dire need of analytical, critical-thinking workers.
“One of the things that our office is tracking is the hiring difficulties that manufacturing employers are facing,” Vilsack says, adding that manufacturers statewide have reached out to a variety of local high schools, community colleges, and technical schools to discuss starting up internships and fellowships.
“There are a lot of efforts not only here at DEED but through some of our Governor’s Workforce Development Council and other regional organizations to make that connection with higher education,” she adds.
Minnesota is known nationwide for excellence in an assortment of manufacturing sectors, Vilsack explains.
“Some of our largest numbers of manufacturing jobs are in areas we specialize in, like our computer and electronic products sector, as well as food and machinery manufacturing,” she says, adding that Minnesota’s top manufactured export is computers and electronics, at almost $4 billion, followed by machinery and transportation equipment.
“We’re probably most known for our medical devices,” she adds. “We have a strong concentration of medical device technology and manufacturers here.”
And approximately 40 percent of Minnesota’s Fortune 500 companies in 2012 operate in manufacturing, DEED says. Cargill, a food and agricultural products manufacturer and the largest private company in the U.S. with $119.5 billion in revenue for fiscal year 2011, is based in Minnesota.
“There are a variety of different programs available through DEED that manufacturers are able to take advantage of, whether it’s tax financing or tax credits,” Vilsack says. “There are certainly quite a lot of opportunities.”
But what makes the Land of 10,000 Lakes tick is its workforce. Minnesota has the second-most educated young workforce, according to the U.S. Chamber of Commerce, and its higher education system is the fourth most productive in degrees per 18- to 24-year-olds.
Overall, the Chamber ranked Minnesota sixth-best nationwide in 2013 in regards to its reliable talent pipeline and workforce education system.
In its analysis, the Chamber cited the Minnesota Job Skills Partnership as a particularly beneficial program. The initiative offers grants to community colleges working in partnership with business to develop intensive workforce training programs for new and existing employees. Training programs developed through the Partnership can last for several years, offering sustained support to growing, job-creating businesses.
The Chamber says Minnesota has also prioritized training and skills development for at-risk young individuals. The Office of Youth Development oversees a variety of programming to build work skills, in essence helping young people access the tools they need to find work.
Likewise, the University of Minnesota’s chemical engineering program was ranked third best in the nation in 2010 by U.S. and World News Report, according to DEED.
“We always say we’re a great place to live, work, and do business,” Vilsack explains. “We’ve got the third-highest labor force participation rate in the nation. Our wages, particularly in production occupations, are very competitive with states that have larger manufacturing workforces. We’re home to over 200 public and private post-secondary institutions which are training our workforce for the needs of the local economies.”
And now that construction is rebounding after hitting bottom-of-the-barrel levels during the Great Recession, statewide manufacturing sectors that include strong input from the housing market are growing.
“We have some major manufacturers here that produce windows and doors for our home building and construction industry. Since the end of the recession, we have started to see increases particularly in our machinery and fabricated metal products areas,” Vilsack says. “These are the types of companies that are more likely to respond to changing supply and demand conditions, so they’ve been able to meet the need of the larger industry.”
And that’s the importance of the state’s Manufacturers Week – to not only keep these trends going, but to ensure it can withstand any economical or workforce challenges that may come about in the near future.
“For us, manufacturing is a well-paying industry that has wonderful job opportunities for making goods that are exported across the world,” Vilsack says. “For us, this is not only a sector where we see jobs, but a sector where the returns on these wonderfully-created products are felt right here in Minnesota, and we want to see that continue.”
About the Minnesota Department of Employment and Economic Development (DEED)
The Minnesota Department of Employment and Economic Development (DEED) is the state’s principal economic development agency. DEED programs promote business recruitment, expansion, and retention; international trade; workforce development; and community development.
Click here to read Minnesota business briefs.