2017 ECONOMIC AND WORKFORCE PROFILE Chippewa County
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1 2017 ECONOMIC AND WORKFORCE PROFILE Chippewa County STATE OF WISCONSIN DETI CHP-P (R. 3/2018)
2 Percentage of Total Popula on, Ages 65 and Older
3 Wisconsin now has more people employed and more private sector jobs than at any me in its history. As of this wri ng, the state added 56,100 jobs during 2016 and Employment increased in almost all industry sectors, with prominent gains in construc on, manufacturing, and healthcare. Wisconsin s unemployment rate is near lows not seen in a genera on, decreasing from 4.3 percent in January 2016 to 3.2 percent in December 2017, on a seasonally adjusted basis. Wisconsin faces a worker quan ty challenge. The number of re ring Baby Boomers nearly match the influx of new workers, resul ng in a slow growing workforce and placing constraints on the ability by employers across all industries to hire talent. Many businesses report that the lack of available workers has hindered expansion and, in some cases, even curtailed their ability to meet current product orders. The blue line, orange line graph to the right illustrates the situa on in Wisconsin and other upper Midwest states. While Wisconsin's popula on will con nue to grow over the next twenty years, the workforce faces serious constraints. The labor force par cipa on rate (LFPR), defined as the labor force (sum of employed and unemployed) divided by the total popula on ages 16 and older, measures the popula on's engagement in the workforce and serves as an indicator in determining how Wisconsin's workforce will be constrained. The overall LFPR peaked in the late 1990s and has been trending lower ever since. The LFPR of peaks across Source: Local Area Unemployment Sta s cs, Bureau of Labor Sta s cs the age cohort at over ninety percent and decreases rapidly into the single digits by age seventy. Baby Boomers have and con nue to exit with respect to their LFPR. The mass of Baby Boomers has moved into the work lifecycle stage of declining LFPRs, with the tail end of the cohort turning 55 in Source: Bureau of Labor Sta s cs A recent development is the change in the labor force par cipa on rate trend. The LFPR of older workers (those aged 55 years and older) has turned upwards, resul ng in fla ening of the overall LFPR. More boomers are staying in the workforce longer, which may portend higher workforce growth over the coming years. Due to the size of the Baby Boomer cohort and the sensi vity of the LFPR to workforce growth rates, a rela vely small change in the LFPR of older workers would significantly boost the number in the workforce. 1
4 Popula on and Demographics Source: Demographic Services Center, Wisconsin Department of Administra on Chippewa County added 1,720 residents from April 2010 to January 2016, growing at a rate of 2.8%, much faster than the statewide growth rate of 1.5%. It ranked the 9th fastest growing among the state s 72 coun es. Net migra on, which is defined as people moving into the county minus those leaving, was posi ve for the period studied, as it was in about two thirds of Wisconsin coun es. Popula on change due to net migra on was 1.3% from 2010 to 2016, faring well compared to the drop in the statewide figure of 0.3%. This was also much faster growth than in the last county profile, which showed net migra on at a 0.04% loss. Growth due to natural increase was 1.5% in Chippewa County, slightly lower than the statewide percent gain. This growth highlights the low median age in the county. Chippewa County s median age of 40.6 is ranked the 22nd youngest in the state (ACS, ). Components of Popula on Change The City of Chippewa Falls is the largest popula on center in the county, with 13,965 residents. The city shares its southern border, and its workforce, with another much larger city, Eau Claire (pop. 65,332), located mostly in Eau Claire County. Chippewa Falls gained 304 residents from 2010 to 2016, con nuing to reverse a small loss in the period. The Village of Lake Hallie grew the fastest and added the most residents, up 468 residents (7.3%). Loca on is the key, as Lake Hallie is sandwiched be Source: Demographic Services Center, Wisconsin Department of Administra on 2
5 Labor Force Dynamics tween Chippewa Falls to the Source: Local Area Unemployment Sta s cs, Bureau of Labor Sta s cs north, and Eau Claire to the south. Not surprisingly, the fastest growing areas like Lafaye e, Wheaton, Eagle Point, and Anson townships are near these two ci es. In the case of Anson and Eagle Point, growth also tracks along Lake Wissota, a desirable neighborhood and popular recrea on area. The graph above compares Chippewa County s monthly unemployment rate to the state and na on. Chippewa s rate of 2.6% in May 2017 is quite low historically speaking, although not as low as during the booming economy of the late 1990s. While a growing economy is par ally responsible for today s low unemployment rates, the trend of slow labor force growth (or even declines in some coun es) due to baby boomers leaving the labor force also impacts the rates. Source: Local Area Unemployment Sta s cs, Bureau of Labor Sta s cs You can see this concept displayed on the graph to the le. The labor force consists of the employed and unemployed (represented as the sum of stacked bars in the graph), so the trend will be along the top edge of the bars. Chippewa s labor force has seen significantly slower 3
6 Industry Employment and Wages growth this decade than the early 2000s, a trend likely to con nue into at least the next decade. Chippewa Coun ty s young popula on may blunt some of the impact of the re ring baby boomers on the county s labor force, along with the large student popula on in the surrounding area, it s important to remember that many of those younger workers are post secondary students, some of whom leave a er gradua on. However, having a pool of possible workers available a er gradua on, if the county has the higher skill jobs to absorb them, it is in a much be er situa on than many coun es around the state. Employers need to convince them to stay in the area, which o en is an easier prospect for an area than luring in workers from elsewhere. Chippewa County saw job growth of roughly 1.0% (235 jobs), from 2015 to 2016, ranking it 33rd among the state s 72 coun es, by percent change. Trade, transporta on and u l i es, the largest industry su per sector in the county, gained 18 jobs from 2015 to Truck transporta on lost 59 jobs, likely related to the sand mining industry, though more recently sand mines appear to be hiring again. Manufacturing, the largest industry super sector of em 4
7 Employment Projec ons ployment listed in Chippewa County gained 93 jobs from 2015 to The 3 largest sub sectors in manufacturing account for almost 60 of manufacturing employment in the county computer and electronic product manufacturing (+17 from ), fabricated metal manufacturing ( 2), and machinery manufacturing (+2), respec vely. Suppression makes it difficult to see which sub sector accounted for most of the job gain, but it s interes ng to see computer and electronic product manufacturing gaining jobs, given a post recessionary trend towards a declining employment level. Educa on and health, the third largest industry super sector in Chippewa County by employment, lost 38 jobs from 2015 to This was due to a loss of 139 jobs in hospital employment, all other healthcare sub sectors (like clinics and residen al care facili es), and educa on, gained jobs during this me period. While studying past trends is useful, DWD also produces projec ons of industry and occupa on employment into the future. The industry and occupa onal employment projec ons in this profile are for the nine county West Central Wisconsin Workforce Development Area, produced every two years, following Bureau of Labor Sta s cs methodology. While this region includes more than just Chippewa County, which accounts for almost 13% of employment in the region, employment and economic dynamics are similar enough throughout the region to comment on general trends. Employment across all industries is expected to grow by about 6% over the ten year period, or almost 14,000 workers. This projec on only forecasts levels of filled posi ons rather than poten al demand. This further illustrates the issues associated with the aging popula on while growth in the labor force is slowing, and in some coun es even declining, job growth is expected to con nue. So while businesses are already having difficulty filling the job openings vacated by re rees, increasing difficulty will be felt filling new openings as well, which could even end up constraining job growth by limi ng expansions. Solu ons to this issue will be different for each business, but will likely include a combina on of possibili es like talent pipeline development (examples include the Wisconsin Fast Forward training grants, and business alliances 5
8 Employment ProjecƟons Source: Office of Economic Advisors, Wisconsin Department of Workforce Development, September 2015 aimed at marke ng specific careers), increased focus on talent a rac on and reten on, engaging under u lized workforces (like those with barriers to workforce entry), increased automa on, and retaining re rees in non conven onal work arrangements to name a few. The most significant numerical growth is expected in Educa on and Health Services (3,353, 6% growth rate), and Professional and Business Services (2,272, 13.5% growth rate). Another super sector with strong an cipated growth is the Construc on sector (1,085, 15.7%). While industry projec ons have their uses, a more func onal approach is projected occupa onal growth. An examina on of projected occupa onal employment growth reveals a possible explana on for the moderate growth rates an cipated in a number of the region s largest industry sectors. We first see that the most signifi cant occupa onal growth can be observed in a number of occupa onal categories largely concentrated in the Health Services sector, including Healthcare Prac oners, Healthcare Support, and Personal Care and Services workers. Significant growth is also an cipated in many other occupa onal sectors, suppor ng the narra ve of long range stability in many of the region s largest industries. The other trend that is also illustrated is that of labor constraints as openings created due to replacement needs outnumber those generated by new growth by 6
9 over three to one in the region. This is the reason for the increased importance placed on the availability and skill sets of young workers entering the region s workforce. It s vitally important to realize that slow growth or declines in employment don t necessarily reflect on the health of those industries. Employment declines may be due to factors such as increased automa on and produc vity. There will be many openings simply due to re rements! Further illustra ng the impact of aging demographics, the graph above depicts the job base by major industry sector outlining the age distribu on of its job holders in the West Central region. The age distribu ons vary widely from industry to industry, easily observed from the graph. Occupa onal composi on within an area is a complex factor, influenced first by overall labor availability, then individual job holders life stage, experience, educa on/training, etc. This tends to correspond to age. For example, younger inexperienced workers, like many of the region s students, tend to work in entry level jobs. These entry jobs are more prominent in industries such as the leisure and hospitality sector. Other industries, such as the educa on and health care sector, require workers to have completed a higher level of formal educa on or training and so they have a rela vely low share of the youngest working cohorts. Typically, higher educa on levels tend to correspond to older age groups who have invested the me necessary to achieve those advanced educa onal levels. O en when examining age/labor force issues, we focus too broadly on labor force entry and exit data, to tell us how many workers are available. While useful, this ignores the dynamics within the workforce, which is not a homogenous popula on. Data such as age by industry can give us ac onable informa on like which industry will have the most upcoming re rements, promp ng a need for recruitment and succession planning. For More Informa on: Sco Hodek Regional Economist West Central WDA Phone: (715) sco.hodek@dwd.wisconsin.gov 7
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