Northeast Minnesota labor trends like a rummage sale

This week I’ll be taking part in Policy and a Pint, a discussion series sponsored by the Citizen’s League and MPR’s The Current. The event, titled “Talent Within the Range,” runs from 6-8 p.m. tomorrow, May 18, at the Minnesota Discovery Center in Chisholm. (Tickets are free; sign up here). In honor of the occasion, I’ll be visiting themes related to the future of the Iron Range workforce here at the blog this week. Today’s entry explores two of the challenges facing predicting the future of the Iron Range.

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Ever been to a rummage sale? Boy, you can find some great stuff at great prices at a rummage sale. You can also find strange metal contraptions whose purpose has been long forgotten, even by the seller. One glove. One shoe. Two pairs of gently used underwear. You can also find a lot of things you could almost use. If only.

It’s like that for the Northeastern Minnesota labor market, too. Don’t let anyone tell you there are no jobs. In the fourth quarter of 2016, the northeast region posted more than 6,000 job openings. The Minnesota Department of Employment and Economic Development reports that’s the fifth highest total on record.

But there’s a reason it doesn’t *feel* like a hiring boom on the ground.

DEED explains:

The median wage offer across all job vacancies was $12.47, which was also down compared to the $13.80 offer posted in the fourth quarter of 2015. Much of this was due to a shift in the type of vacancies posted.

For example, the percent of openings that were part-time jumped from 36 percent in 2015 to 56 percent in 2016, while the percent of vacancies that required post-secondary education dropped from 43 percent to 33 percent. Employers placed the same premium on prior work experience, with about one-third of openings requiring at least one year of experience in both 2015 and 2016.

The other noticeable drop in compensation for vacancies in 2016 showed up in the percent that provided health care benefits – just 41 percent offered health care in the fourth quarter of 2016, compared to 59 percent of openings in the fourth quarter of 2015.

If you try to get into the heads of people who are unemployed, underemployed, or who have left the labor market, you see the problem. Taking a lower-paying part time job isn’t as appealing if there is little hope of it becoming full time or ever offering benefits. It lacks the promise of career development or the reward of a living wage.

If you’re getting by in your current job, no matter how much you’d rather have a better one, you’ll probably stick with what you’ve got. If you’re a recent graduate, you’ll either hold off for something better in this region, or play better odds in a different region or state.

In rural areas, calls for efficiency squeeze as relentlessly as anywhere else. But the only way to “streamline” a single job is to make it part time. One finds fewer jobs in rural areas due to population. Thus, employers often use part time jobs to patch things together. That means less stability for those who do the work.

In other words, you might be curious about what’s at the rummage sale. But you won’t buy anything unless you really need it, or unless the price is insanely appealing. Some people will find a great fit, but most people shuffle through with hungry eyes. That’s because part time work and lower wages run the risk of sending the workforce of tomorrow looking elsewhere.

And that becomes our central challenge.

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