|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
Minnesota Department of Economic Security Memorandum
We hope that you have enjoyed our December 2000/January 2001 issue of
Minnesota Economic Trends. We try to cover hot issues as well
as provide general information so that our customers can better understand
the Minnesota economy and its dynamic labor market. While we cannot cover
every relevant and hot topic, if you have story ideas you would like us
to explore in the future, please be sure to pass these suggestions along
to me. The State of Minnesota Job Vacancy Survey is our newest LMI
product. For years we heard anecdotal information about the labor shortage
in the state. This first-ever statewide study of its kind provides hard
data on the subject. In this study we estimate the number of job vacancies
during the fourth quarter of 2000 across the state along with the wages
and benefits offered by these open-for-hire positions. There were an estimated
124,000 vacancies in Minnesota or five vacancies for every 100 jobs statewide.
Seventy-one percent of all vacancies were located in the Twin Cities seven
county region. The number of vacancies compared to the number of unemployed is almost
three to one in the Twin Cities while it is less than one to one in Greater
Minnesota. In other words, shortages of workers may be more severe in
the Twin Cities. This comparison, of course, does not take into account
currently employed job seekers and people who move or commute from out-of-state
for jobs in Minnesota. Our booming economy helped to push up the population
in the state faster than expected in the 1990s. People from all over the
country and the world are being drawn to Minnesota for the good jobs we
have to offer. While workforce shortages are difficult to measure, the State of
Minnesota Job Vacancy Survey is the best tool available to date to
identify shortage occupations and industries. During the fourth quarter
of 2000, sales and related, office and administrative support, food preparation
and serving, production, and health care support were the occupational
groups with the most job vacancies, largely reflecting the distribution
of jobs statewide. It is critical to understand, however, that the job
vacancy estimate tells only part of the story. We have developed other
measures and indices to allow us to identify shortages using job vacancy
data. First, it is important to realize that the number of openings in each
occupation largely reflects the size of the occupation. The job vacancy
rate controls for this. Healthcare support, for example, has the highest
vacancy rate. In other words, this is the occupational group with the
largest number of vacancies relative to filled jobs. Second, it is important to look at how many of the vacancies in any occupation
are seasonal/temporary and part-time when using vacancy data to pinpoint
worker shortages. For example, employers told us that 34 percent of the
sales and related vacancies were temporary or seasonal and 62 percent
were part-time. Holiday hiring was in full swing when we asked employers
to list their job vacancies so of course more sales jobs were listed at
this time than may exist at any other time of the year. But this does
not necessarily mean that there is a shortage of workers to fill these
jobs or that resources should be allocated to encourage incumbent workers
to go into this field of employment. Third, occupations with vacancies that take a long time to fill may indicate
a "market clearing" problem, that is, there may not be enough workers
to fill available jobs. One confounding factor is that employers could
report 'always open' for this question. The greatest number of vacancies
in sales and related occupations, for example, were reported as being
always open. There is more than one way to interpret this response: do
firms always have vacancies because turnover (workers cycling in and out
of the same positions) is high or because it is difficult to fill open
positions? This raises the fourth issue: turnover. Three factors drive job vacancy levels: the demand for new entries to the field (newly created jobs), the number of available and qualified job applicants, and turnover - the rate at which workers cycle in and out of jobs. In occupations with high turnover, the same job may be open over and over again in the course of a year, but the same pool of workers is always available to take those jobs (since they have recently left similar jobs). On the other hand, in a more stable occupation, there may only be one job open during the year, but because no one has recently left a similar job, the employer may have difficulty locating even one qualified applicant. We have developed a measure to control for the effect of turnover, called the turnover adjusted demand (TAD) index. This index measures workforce demand due to factors other than turnover - mainly the demand for new entries to the field.
Taking all four of these factors into account, the following is a list of the occupational groups with workforce shortages: · Healthcare support including nursing aides, orderlies and attendants, home health aides, and healthcare support workers, all other. · Community and social services including counselors, community and social service specialists, educational, vocational and school counselors, rehabilitation counselors, and social and human service assistants. · Healthcare practitioners and technical including licensed practical and licensed vocational nurses, and registered nurses. · Architecture and engineering including engineers, engineering technicians, and industrial engineers. · Sales and related including retail sales, cashiers, and sales representatives in manufacturing and services. · Personal care and service including hairdressers, hairstylists and cosmetologists, personal and home care aides, and child care workers. Only about 27 percent of vacancies required post-secondary education.
However, keep in mind that full-time jobs were much more likely than part-time
jobs to require post-secondary education, and occupations with lower educational
requirements also tend to have higher levels of turnover than occupations
with higher educational requirements. Looking at full-time vacancies only,
the percent that required post-secondary education rises to 34. Full-time
permanent job vacancies (as opposed to temporary or seasonal vacancies)
had the same distribution of educational requirements as all full-time
vacancies. Educational requirements for job vacancies in Greater Minnesota
were, on average, lower than in the Twin Cities during the same period. Educational attainment earns job seekers in Minnesota a large wage premium.
The median wage for a job that required less than a high school diploma
was $7.35 per hour while the median wage for a vacancy requiring a bachelor's
degree was $19.88 per hour. The median wage offered increased incrementally
for each additional educational level required. The Research and Statistics Office plans to conduct a second round of the State of Minnesota Job Vacancy Survey during the second quarter of 2001. There are several reasons for this: · Vacancies are a point-in-time estimate and are very sensitive to the business cycle. A second round this year will provide us with up-to-date information on our rapidly changing economy. · A second round of the survey will allow us to better understand the role of seasonality in our vacancy estimates. For example, many schools told us that they planned to hire teachers in the summer but had no current openings because they just do not hire during the late autumn. A late spring round should allow us to pick up those occupations with different hiring cycles. For the full results of the State of Minnesota Job Vacancy Survey
please see our website at http://www.mnworkforcecenter.org/lmi/public.htm
or call 651-296-6545 for a hard copy. Other products that we will be releasing during the next four months include our short-term employment forecasts. Preliminary estimates indicate that 2001 employment will grow at a rate of 1.3 percent, the slowest growth rate since 1991, if the forecast holds true. Look for the full report in the Minnesota Employment Review, March issue. We will also release the Regional 1998 to 2008 Employment Projections this spring. Finally, watch for another issue of Minnesota Economic Trends due out in late spring.
|