The State of St. Louis Workforce Report 2009

2009·2.4 MB·English

by  Missouri Department of Economic Development, Missouri Economic Research and Information Center

2009
The State of St. Louis
Workforce Report
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Foreword
Business and Community Leaders,
On behalf of St. Louis Community College, the St. Louis Agency on Training and
Employment and the St. Louis County Division of Workforce Development, we are pleased to
bring to the community the 2009 State of St. Louis Workforce Report. We believe that this report
provides critical workforce intelligence that business, economic development and education
decision makers will fi nd valuable as they develop strategies to address a changed environment
for business development, economic development and talent development for our region.
The St. Louis region, like many others across our nation, has been signifi cantly impacted by the
rapid deterioration of our economy and labor market. Most experts predict a long and slow
recovery unlike typical recoveries from the cyclical recessions we have experienced over the last
30 years. Some predict a national unemployment rate in excess of 10% lasting well into 2011.
Our region may be faced with even greater challenges as structural changes in our economy,
which have been occurring at a steady pace over the last several years, will almost certainly
be accelerated. The rapid and severe decline in manufacturing employment, particularly the
1 automotive industry; the increase in fi nancial services, health care and education; the emerging
plant science industry; and the dynamic nature of information technology employment all
require new thinking and new strategies by those whose job it is to develop the talent that will
drive the region’s post-recovery economy.
Missouri is fortunate to have one of the fi nest state labor market information offi ces in the
nation. The Missouri Economic Research and Information Center (MERIC), a unit of the Missouri
Department of Economic Development worked closely with us to build upon existing labor
market data with real time information from regional employers representing a cross section
of industry sectors and dislocated workers faced with tremendous challenges in preparing to
re-engage in a post-recovery economy.
The report is made up of several parts including: the results of a survey of over 1,537 employers
focusing on the effects of the recession and plans for a post-recovery period; a survey of 447
dislocated workers asking them about their challenges and plans for re-employment; and case
studies of 6 companies providing additional context to the survey data. We believe that, together,
these components provide greater focus for evaluating a changed economy and labor market
and will contribute to making the critical decisions that may affect our region for years to come.
Table of Contents
1. Executive Summary 3
2. St. Louis Economy 4
3. Employer Survey 7
4. Dislocated Worker Survey 14
5. Conclusion 18
2
6. Appendices
a. Employer Survey Questions 19
b. Case Studies 21
c. Dislocated Worker Survey Questions 24
d. NAICS Description 27
e. Acknowledgements 30
Executive Summary
S
ome say that the mark of an individual’s character is determined by how
they handle life when faced with adversity. The same can largely be said of a region
in terms of how local economic and workforce development communities come together
to jointly address a severe economic downturn. The extent to which both communities
have developed a learning curve from past major layoff events and economic cycles
can determine how nimbly and effectively a region can mitigate the effects of high
unemployment and a slow business climate. Learning from the past combined with active
efforts to study how current events are different than past downturns are both critical
to meet the needs of local businesses and dislocated workers in the St. Louis region.
This study was a joint effort by St. Louis Community College, St. Louis Agency on
Training and Employment, the St. Louis County Division of Workforce Development
and Missouri Economic Research Information Center (MERIC) to profi le the economic
landscape of the St. Louis Metro area by examining the business climate, identifying
employment trends and patterns of worker dislocation. The results will hopefully
provide decision makers the needed guidance to more effectively support and
3
align services for both local business and dislocated workers in the St. Louis region.
The fi rst section of the report discusses the fi ndings of the Employer Survey, designed to gain
key insights into business conditions, hiring strategies and plans. It offers a glimpse of the
challenges employers are facing in this economy, the strategies they are using to adapt and their
future plans. The survey was also supplemented with case studies with employers in the region.
The second part of this report is the Dislocated Worker Survey. It presents a profi le of these
workers, how they are dealing with job losses and the services that can be provided to
better assist them.
The Employer Survey fi ndings show that:
• Business performance in terms of revenue and sales is fl at, as companies diversify
focus and re-invent strategies.
• Hiring has slowed at the moment.
• Employment plans for the future look optimistic, especially in some sectors such as
Educational Services, Healthcare and Social Assistance, Retail Trade and
Manufacturing.
The Dislocated Worker Survey reports:
• Most dislocated workers have had steady employment, are disproportionately
older than the labor force and have minimal education.
• Earning wages to support a family is the primary concern of the dislocated worker.
• Dislocated workers are interested in accelerated training programs to help them
transition back into the workforce.
St. Louis Economy
This section provides an overview of the
region’s current labor market.
St. Louis MSA Counties
The bi-state St. Louis MO-IL Metropolitan
Statistical Area (MSA) is made up of a total of
16 counties, consisting of Franklin, Jefferson,
Lincoln, St. Charles, St. Louis City, St. Louis ,
Warren and Washington on the Missouri side
and Bond, Calhoun, Clinton, Jersey, Macoupin,
Madison, Monroe and St. Claire on the Illinois
side. It ranks as the 16th largest MSA in the
USA (2007).
Labor Force
Historically, almost 20% of the region’s workforce has been in the age group of 45-54
years.
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Source: U.S. Census Bureau and the State of Missouri, Local Employment Dynamics program.
Labor Force by Age Group St. Louis MSA 2007
Age group Percentage
DData from 2007 indicates persons
45 to 54 years 25%
iinn the age group of 35 to 44 years
35 to 44 years 23%
aannd 45 to 54 years combined
25 to 29 years 10%
aacccount for 48% of the labor force
30 to 34 years 10%
iinn this region.
55 to 59 years 9%
22 to 24 years 6%
16 to 19 years 6%
20 and 21 years 4%
60 and 61 years 3%
62 to 64 years 3%
65 to 69 years 2%
70 to 74 years 1%
75 years and over 1%
Source: American Community Survey
Industry Employment and Projections
Educational Services, Healthcare and Social Assistance, Retail Trade and Manufacturing
are the largest private employing industries in the region. Listed below is employment by
industry.
NAICS Industry Annual Average P ercen t Of To tal
20 07 E mploy ment 2007

11 Agriculture, forestry, fi shing and hunting, 10,677 0.80%
and mining
23 Construction 93,619 6.80%
31-33 Manufacturing 157,040 11.40%
42 Wholesale trade 45,320 3.30%
44-45 Retail trade 163,773 11.90%
5
48-49 Transportation and warehousing, and 78,818 5.70%
utilities
51 Information 33,752 2.50%
52-53 Finance and insurance, and real estate 107,920 7.90%
and rental and leasing
54 Professional, scientifi c, and management, 132,091 9.60%
and administrative and waste
management services
61-62 Educational services, and health care and 291,626 21.30%
social assistance
71-72 Arts, entertainment, and recreation, and 134,532 9.80%
accommodation, and food services
81 Other services, except public
administration 69,451 5.10%
92 Public administration
53,220 3.90%
Source: MERIC, U.S. Bureau of Labor Statistics.
Short term industry projections are developed for the State as well as for the Kansas City and
St. Louis metros. For this region, the most representative region for comparison is the St. Louis
Region. From 2008 to 2010, this region is projected to have more than 57,000 job openings.
Listed below are the top ten fastest growing industry sectors in this region for 2008-2010.
NAICS Title 2008 Estimated 2010 Projected Percent
Code Employment Employment Change

515000 Broadcasting (except Internet) 2,550 2,640 3.77%
446000 Health and Personal Care Stores 7,650 7,900 3.32%
611000 Educational Services 86,820 89,570 3.17%
623000 Nursing and Residential Care 22,590 23,210 2.72%
Facilities
6
452000 General Merchandise Stores 20,590 21,150 2.70%
621000 Ambulatory Health Care Services 40,790 41,730 2.32%
624000 Social Assistance 17,770 18,180 2.31%
492000 Couriers and Messengers 5,160 5,260 1.96%
999200 State Government, Excluding 9,090 9,250 1.77%
Education and Hospitals
523000 Securities, Commodity Contracts, 7,760 7,880 1.57%
and Other Financial Investments
and Related Activities
Source: MERIC Short-tem Occupational Projections, MERIC Occupational Employment and Wage Survey
and U.S. Bureau of Labor. See Appendix D for detailed NAICS Code description.
Historically, Missouri’s unemployment rate has been lower than the national average.
However, since early 2009, mirroring the national trend this region also saw a steady
decline in employment. In May 2009, non-farm employment in this region was 45,200
lower than at this time last year. The largest losses were in manufacturing (11%).
However, growth was observed in educational and health services, adding 3,700
jobs and refl ecting a (1.7%) increase. As of May 2009, the region’s unemployment
rate was (9%), a 3.1 percentage point increase from the May 2008 rate of 5.9%.
Employer Survey
T
he intent of this survey was to understand the business climate, market conditions,
employment trends and occupation and skills demand from businesses in the St. Louis region.
Data for this survey was taken from the MERIC employer database which is comprised of data
from InfoUSA – a source that contains up-to-date contact lists of over 400 million companies
across the nation. The total population consisted of 117,970 businesses made up of 94,225
businesses from the Missouri counties and 23,745 businesses from the Illinois counties. The
total population was then stratifi ed by industry classifi cation or NAICS (North American
Industry Classifi cation System) codes. There are 22 such super sector industry classifi cations. A
random sample of 1,537 interviews was selected and telephone interviews were conducted
with business owners or those in charge of hiring across the region. The quantitative results
from this survey were also supplemented with qualitative data from employer case studies.
Employer Size
In the population, it was noted that the largest group of employers (87%) surveyed
comprised of businesses with more than one but less than a hundred employees.
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Employer Size Percentage

Self Employed 3%
Less than 100 87%
Greater than 100 7%
but less than 500
4%
500 or greater
Key Findings
Business Conditions
To assess how businesses are dealing with the slowdown in the economy, employers were
asked to rate their current business performance in terms of revenue and sales. A majority
of the employers in the St. Louis Region (40%) indicated a positive outlook, twenty nine
percent indicated no change and twenty one percent indicated a poor outlook. Response
to a follow-up question about the expectations of business performance in the next 12
months was somewhat more encouraging with forty eight percent indicating it as positive,
twenty eight percent indicated no change and only thirteen percent stating it as poor.
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Access to Credit for Business Operations
The current fi nancial crisis has created great concern about both the degree to which companies
will have problems securing credit and the duration of this situation. While, a little over half
of the respondents in this survey (55%) reported that access to credit for business operations
had stayed the same, nineteen percent indicated that credit markets had tightened, while
twenty three percent were unsure or declined to answer the question. Only four percent of
respondents reported that access to credit had increased. Some companies declared no
shortage of cash fl ow due to conservative internal fund management or being self funded.
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Cost of Benefi ts
Employee benefi ts are a signifi cant part of an employer’s budget, accounting for
a large portion of total employee compensation. When employers in the St. Louis
region were surveyed regarding the cost of benefi ts they offered to their employees,
fi fty eight percent of them stated that the cost of benefi ts had increased, thirty
two percent said they had decreased and about ten percent had no comments.
It is interesting to note that even though majority of the employers stated that costs are rising,
surveyed companies also indicated that they would not be reducing the benefi ts they offer new
hires when they do begin hiring in order to be competitive and attract and retain the right talent.
Barriers to Expanding Employment
To better understand how the recent economic downturn was affecting the talent pipeline in
the St. Louis region, it was essential to investigate the barriers employers in the region face
in acquiring talent. While thirty percent of employers stated that current economic conditions
were the biggest barrier to expanding employment, twenty three percent indicated
the shortage of skilled workers and training programs in the region was also a barrier.