ADVANCED MANUFACTURING 2016 THE COLUMBIA-WILLAMETTE WORKFORCE COLLABORATIVE Working together to support and develop regional talent. ABOUT THE COLUMBIA-WILLAMETTE WORKFORCE COLLABORATIVE The Columbia-Willamette Workforce Collaborative (Collaborative) is a partnership between the Clackamas Workforce Partnership, Workforce Southwest Washington (formerly Southwest Washington Workforce Development Council) and Worksystems: the three Workforce Development Boards covering the Portland-Vancouver Metropolitan Area. The Collaborative delivers a unified approach to serving industry, supporting economic development, and guiding public workforce training investments to better address the needs of our combined labor shed. We know that people are willing to travel throughout the region for the best opportunities and that employers need the most qualified workers regardless of where they live. By working together, we can cultivate our regional talent pool and build the foundation for a strong economy. ABOUT THIS REPORT The Collaborative is focused on aligning and investing resources to support the workforce needs of four sectors: Advanced Manufacturing, Health Care, Software/IT, and Construction. Sectors are chosen based on factors such as their economic significance to the region, current number of openings and job growth projections, average wages that support self-sufficiency, and career ladder opportunities across the skill continuum. By examining labor market intelligence (such as the data contained in this report) and vetting the information with business partners, we are able to better understand industry trends, identify current and emergent workforce needs, and develop customized solutions for each sector. ACKNOWLEDGEMENTS Much of the data in this report was provided by the Oregon Employment Department and the Washington Employment Security Department, key partners in the region’s workforce development system. The Collaborative is dedicated to assuring this information is regularly updated and presented in a way that advances the region’s capacity to understand and align regional workforce supply with business demand in key industry sectors. OVERVIEW With nearly 100,000 jobs and a payroll of $7.6 ADVANCED MANUFACTURING billion, Advanced Manufacturing accounts for 10 EMPLOYMENT BY COMPONENT percent of the greater Portland region’s private- GREATER PORTLAND REGION: 2015 sector employment and 15 percent of payroll. The region’s economy is highly dependent on the manufacturing sector. In 2014, the Portland Metro Area ranked third nationally among the nation’s High Tech Manufacturing Food Processing largest metro areas in the proportion of its GDP 42,600; 44% 15,000; 16% generated by manufacturing: 30 percent compared to 12 percent nationally. The Advanced Manufacturing sector includes high Metals, Machinery, & Transportation 38,500; tech, metals, machinery, transportation equipment, 40% and food processing. Source: EMSI ADVANCED MANUFACTURING JOBS BY COUNTY GREATER PORTLAND REGION: 2015 Nearly half of the region’s Advanced Manufacturing jobs are located in Washington County, due largely to Clackamas Intel. 14,300; 15% Multnomah Multnomah County has a small concentration of jobs 25,700; 27% Clark relative to the overall size of its economy. 8,800; 9% Clackamas County, with 14,300 jobs, accounts Yamhill 4,700; for 15 percent of the region’s employment, and Washington 5% 39,600; 41% Southwest Washington chips in 2,700 jobs (3%). Companies tend to be clustered along major road, Remainder* water, and rail transportation corridors. 3,100; 3% Source: EMSI *Columbia, Cowlitz, Skamania, Yamhill, Wahkiakum counties Sector Report: Advanced Manufacturing 1 FIRM CHARACTERISTICS FIRMS BY SIZE IN GREATER PORTLAND REGION: 2015 70% The sector has more large firms and fewer smaller 60% firms compared to the overall economy. Advanced Manufacturing 50% All Industries (private sector) The average firm size is over three times larger than 40% the average company in the region: 43 employees 30% per company versus 15 across all industries. Share of Total 20% More than half of the region’s Advanced 10% Manufacturing employment is in establishments 0% employing more than 250 people. 1-4 5-9 10-19 20-49 50-99 100 or more Firm Size (# of employees) Source: Oregon Employment Department, Washington Employment Security Department MAJOR EMPLOYERS Intel, the region's largest private-sector employer, MAJOR EMPLOYERS: ADVANCED MANUFACTURING had an economic impact totaling $26.8 billion in 2012 (source: EcoNorthwest). Although not Blount International Oregon Iron Works headquartered in the region, Intel’s Washington Inc. PDM Steel Service Centers County campuses comprise the company’s largest Bob’s Red Mill Natural Precision Castparts/PCC Foods and most advanced operations in the world. Structurals Boeing Reser’s Fine Foods Inc. C-Tech Industries Major ‘home grown’ or locally headquartered Rockwell Collins Aerospace Daimler Trucks & Electronics, Inc. companies include Blount (recently sold but still Electro Scientific Sharp Microelectronics headquartered here), ESCO, Leatherman, Electro Industries Inc. Siltronic Corporation Scientific (ESI), Cascade Steel, Reser’s, Tektronix, Foster Farms Steelscape, Inc. and Oregon Iron Works. Gunderson Tektronix Intel Corporation TriQuint The region’s Advanced Manufacturing firms produce KapStone United States Bakery a wide variety of products including semiconductors, Leatherman Tool Group, Viasystems (Merix) streetcars, engine parts, electrical vehicle chargers Inc. Vigor Marine and oscillopes. LifePort, Inc. WaferTech Linear Technology Waite Specialty Machine Mondelez International Inc. (formerly Kraft Foods) Weyerhaeuser Norpac LLC Xerox Corporation Neil Jones Food Co Source: Equifax (EMSI), The Business Journal, The Oregonian 2 Columbia-Willamette Workforce Collaborative CONCENTRATION LOCATION QUOTIENTS Location quotients are used to ADVANCED MANUFACTURING AND COMPONENTS measure a sector’s employment GREATER PORTLAND REGION: 2014 concentration in an area. A 3.50 figure greater than one indicates a higher concentration of 3.00 3.00 employment relative to the nation. A location quotient greater than 1 2.50 indicates an industry with a higher concentration of employment relative to the nation. Advanced Manufacturing 2.00 comprises a larger share of 1.41 1.50 employment in the greater 1.19 Portland region compared to 1.00 0.89 the U.S. due primarily to the high tech component, where 0.50 employment is three times as concentrated as the nation. 0.00 Advanced High Tech Food Metals, Machinery, Manufacturing Manufacturing Processing & Transportation The greater Portland region Source: Oregon Employment Dept.; Washington Employment Security Dept., U.S. Bureau of Labor Statistics has a competitive advantage in Advanced Manufacturing and is a net exporter of goods, driven by computer and electronic products, and metals. EXPORTING PORTLAND METRO AREA EXPORTS: 2014 Exports are critical to the region’s economy. According to the Brookings Institution, total exports directly supported more than 94,000 jobs in the High Tech metro area in 2014. Manufacturing (incl. royalties) Advanced Advanced Manufacturing accounted for 80 percent Remainder Manufacturing 70% 20% 80% of All of the Portland Metropolitan Area’s total exports; Exports the largest share among the nation’s 100 largest Metals, Mach. & metro areas. Exports are dominated by computer Transport. 9% equipment. Food Processing 1% Source: The Brookings Institution The metro area’s Gross Domestic Product grew by 5.8 percent in 2014, driven by a 6.6 percent growth in the manufacturing sector, the 13th fastest in the nation. Sector Report: Advanced Manufacturing 3 EMPLOYMENT TRENDS ADVANCED MANUFACTURING ANNUAL GROWTH RATES GREATER PORTLAND REGION VS. UNITED STATES 8% Advanced Manufacturing is a 6% cyclical industry, both locally and 4% nationally. 2% 0% The Advanced Manufacturing -2% sector in the greater Portland -4% Greater Portland Region region consistently outperforms -6% United States the nation. -8% -10% The sector was hit hard during -12% the Great Recession, losing 12 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 percent of its employment base Source: EMSI (11,600 jobs). However, the sector propelled the region out of the recession, growing nearly twice as fast as the rest of the economy between 2010 and 2012. ADVANCED MANUFACTURING’S SHARE OF EMPLOYMENT GREATER PORTLAND REGION AND U.S. 12% Although Advanced 11% Manufacturing is declining as a share of total employment, the 10% Portland region continues to have 9% a much greater share compared Greater Portland Region U.S. to the nation. 8% 7% 6% 5% 4% 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Source: Oregon Employment Dept.; Washington Employment Security Dept., U.S. Bureau of Labor Statistics 4 Columbia-Willamette Workforce Collaborative CHARACTERISTICS OF THE WORKFORCE ADVANCED MANUFACTURING EMPLOYMENT BY AGE GREATER PORTLAND REGION: 2014 30% Half of the region’s Advanced Advanced Manufacturing Manufacturing workforce is 45 25% years or older. All Other Industries 20% The workforce is aging. It is projected that over the next 15% decade, employers will need to fill more than 30,000 vacancies 10% due just to retirements. 5% Youth employment is half that of the overall economy (5.4% vs. 0% 11.9%). 14–18 19–24 25–34 35–44 45–54 55–64 65–99 Source: U.S. Census Bureau; Longitudinal Employer-Household Dynamics ADVANCED MANUFACTURING EMPLOYMENT BY GENDER GREATER PORTLAND REGION: 2014 80% Advanced Manufacturing The Advanced