Part 1: Job vacancy data shows high hurdles for employers, big opportunities for job seekers in Greater Minnesota

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September, 2018

By Kelly Asche, Research Associate

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Ask business owners in Minnesota what their biggest challenge is today and most will tell you: “finding help.” Economic growth coupled with an aging workforce heading toward retirement and fewer young people to replace them is putting significant pressure on Greater Minnesota’s employers, making hiring significantly more challenging.

Business owners have “levers” they can pull to attract applicants, and the data indicate that those levers are being used: wages are up while qualification requirements, such as education and work experience, are decreasing.

But although it might be a good time to be a job seeker, at some point the levers can’t be pulled any further. Without more people entering the labor force to replace the people leaving, businesses will have to make serious decisions, including whether to move or close.

Fortunately for Greater Minnesota, there are numerous partnerships and initiatives developing between private, public, and non-profit institutions to tap hidden talent pools, attract a new workforce through migration and immigration, and retain young people in their regions.

Over the next several months, the Center for Rural Policy will be releasing a three-part series exploring the workforce shortage in rural Minnesota. What follows is part 1, which dives into the job vacancy survey data collected by Minnesota’s Department of Employment and Economic Development (DEED) and sets the context for parts 2 and 3. Part 2 (Fall 2018) will examine the opportunities and barriers facing the private, public, and non-profit collaborations and initiatives being developed to tap hidden talent pools and recruit new workforce into Greater Minnesota. Part 3 (early 2019) will examine the perceptions high school students have toward job opportunities in their regions and look at the programs that are connecting them with these opportunities.

It seems everyone has an anecdote or reason why Greater Minnesota has so many unfilled jobs:

“Businesses need to pay higher wages.”

“People are just lazy and don’t want to work.”

“There are only low-wage jobs in Greater Minnesota.”

“There are just more opportunities and amenities in the Twin Cities metro, so young people will always migrate there.”

While there is often a kernel of truth in anecdotes, most of what we are hearing from people not involved in workforce development nor in the business of hiring employees is inaccurate and is simply encouraging a false narrative of what is currently going on in Greater Minnesota. While the following information is data-heavy, we felt it was important to paint a picture based on the data, thereby building a foundation for productive discussion and exploration of the opportunities and barriers Greater Minnesota is facing when dealing with job vacancies.

Go ahead, play with the data

Of course, each region of Minnesota is different. While this report provides a general overview of Greater Minnesota, we couldn’t include the entire data analysis. We developed an online data report that goes into a bit more detail about the data while allowing users to view job vacancies at both planning region and economic development region levels. You can find that application here.

Talk to the experts

Not only is the data analyzed in this report gathered by the MN Department of Employment and Economic Development’s team of labor analysts, but they also work with employers as well as current and future participants in the labor force. If you want more information about job vacancies in your region or want more information in general about employment and business trends, contact your Regional Analyst. These professionals are the experts in the field.

The rural challenge: An unprecedented number of vacancies and a barely growing workforce

Rural areas are experiencing an unprecedented number of job vacancies at a time when the growth in the number of people participating in the workforce is either slowing or simply declining. The annual quarterly average of job vacancies is the highest it has been since DEED began measuring job vacancies in 2000, and regions in Greater Minnesota have some of the highest vacancy rates, putting significant pressure on employers in these areas who need to fill positions. The problem is only expected to get worse in rural regions due to a higher percentage of older workers compared to the Twin Cities metro area.

Variations by region

The job vacancy rate is defined as the ratio of estimated job vacancies to filled jobs in a region. Although the number of job vacancies is increasing across the state, the rising percentage of vacancies in relation to total employment in Greater Minnesota shows the true uphill battle employers there are facing in finding workers (Figure 1).