Northwest Tennessee Workforce Study

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Northwest Tennessee Workforce Study

• Business and Economic Research Center
• Jennings A. Jones College of Business
• Middle Tennessee State University

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Northwest Tennessee Workforce Study

• Business and Economic Research Center
• David Penn, Director
• Murat Arik, Associate Director
• Susan Harmon, Associate Professor, Marketing

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Overview of Study

• Current economic structure

• Strengths and weaknesses

• Preparedness to grow

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Research Methods

• Analysis of population, employment, income, and
  wage trends
• Survey of local employers
• Survey of workforce professionals
• Focus group interviews

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Research Method
Surveys
Published Data
Focus Groups
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Study Area
Seven counties stretching from the Memphis
suburbs north to Kentucky.
Represent between 3 and 4 of Tennessee
employment, labor force, and population.
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Context

• Important trends
• Increasing importance of trade.
• Foreign-made goods more in demand.
• Exports also growing quickly.
• International trade share of GDP on the rise.

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Context

• Important trends
• Information technology revolution.
• IT sector responsible for large share of recent
  growth.
• Widespread usage of IT has reduced production
  costs, increased productivity.

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Context

• Consequences
• Competition much more intense than ten or twenty
  years ago.
• Companies have little pricing power.

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Context

• Implications
• Pressure to increase productivity will continue.
• Pressure to reduce production costs will
  continue.

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Context

• Results
• More consolidations, downsizing, outsourcing.
• Productivity will be a critical factor can be
  enhanced with continuing education, training.
• Reducing turnover, cutting fixed costs also
  helpful in increasing productivity.

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Current Structure
Population, income, employment
Among other Tennessee workforce areas, per capita
income is one of lowest and unemployment rate one
of the highest.
Growth of population and labor force flat, lag
state growth rate. Personal income growth also
lags state growth rate.
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Current Structure
Industrial Distribution
Much more dependent on manufacturing as a source
of employment and payroll than the rest of the
state, about twice as important as for Tennessee.
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Current Structure
Educational Attainment
Bachelors degree or higher Tennessee
19.6 NW Tennessee 7.6 - 12.0
Less than high school Tennessee 24.1 NW
Tennessee 25.4 - 36.1
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Current Employment Status
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Current Employment Trends
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Current Employment Trends

• Impacts on payroll employment vary by region of
  state.

• Tennessee down 2.5 from peak in Jan 2000 to June
  2003.

• Northwest counties down 8.2 from Jan 2000 peak.

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Strengths and Weaknesses
Weaknesses

• Lack of industrial diversity

• Low educational attainment

• Weak regional cooperation

• Not enough resources for post-secondary education

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Strengths and Weaknesses
Workforce Professionals

• Weak regional cooperation

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Strengths and Weaknesses
Strengths

• Location

• Strong work ethic

There are a lot of people here who do care about
other people. It is a strong community in that
respect. I think we have some positives we just
need to sell those positives to other people.
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Preparedness to GrowEmployers Viewpoint
Skills in new hires
Reading Not a problem 34 Moderate
problem 18 High to critical problem 6
Math Not a problem 26 Moderate problem
28 High to critical problem 10
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Preparedness to GrowEmployers Viewpoint
Skills in new hires
Writing Not a problem 18 Moderate
problem 33 High to critical problem 9
Soft Skills Not a problem 10 Moderate
problem 31 High to critical problem 24
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Preparedness to GrowEmployers Viewpoint
Soft Skills
Right now, in banking, a high school degree is
not enough for the technical skills they need,
communication skills, people skills, soft skills
are not there...just things that a lot of us who
are older learned at home, such as people skills,
communication skills, how to dress.
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Employers View
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Employers View
Occupations in shortest supply
Receptionist/Clerk Machinist Tool and Die
Maker Computer Operator Laborer Welder/Fabricator

Registered Nurse Licensed Practical Nurse Truck
Driver Maintenance Worker Sales
Representative Teller Customer Service
Representative
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Employers Viewpoint
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Employers Viewpoint
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Employers Viewpoint
For occupations in shortest supply
Just 13.4 of jobs could be filled by workers
with less than high school diploma.
These workers comprise 31.1 of the Northwest
Tennessee workforce.
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Employers Viewpoint
For occupations in shortest supply
17.6 of jobs will be filled by workers with at
least a Bachelors degree (23.2 for large
employers).
These workers comprise 10.1 of the Northwest
Tennessee workforce.
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Employers View - Growth
Table 40. Desired Level of Employment 10 Years from Now Table 40. Desired Level of Employment 10 Years from Now
Level of Employment Percent
Fewer Employees 13.1
About the Same Number 18.3
Up to 50 Percent More 42.3
51 Percent to 100 Percent More 17.5
More Than 100 Percent More 8.8
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Employers View Hiring Needs
Demand for workers with less than high school
education will drop sharply during the next ten
years. Demand for workers with a high school
degree will not grow as quickly as for those with
more education and training.
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Employers View - Constraints
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Employers View - Constraints
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Employers Concerns
Generally optimistic about long-run future.
Concerned about costs of health care.
Concerned about workers compensation costs.
Want to find a way to keep more young people in
the area.
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Preparedness to Grow
Uncontrollable factors
Markets trends
Competition
Growth
Controllable factors
Quality of human resources
Cultural and recreational amenities
Infrastructure
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Are We Prepared?Context for Northwest Tennessee

• Future jobs will require broader skills
• Mathematics
• Communication
• Computer skills
• Analytical reasoning
• Creativity

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Are We Prepared?Context for Northwest Tennessee

• A broadly skilled workforce is more able to adapt
  to changing economic conditions.
• Very difficult to identify winners with any
  degree of certainty.
• Workers with broad skills have better chance of
  success.
• Workforce better prepared to take advantage of
  opportunities that arise.

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Final Thoughts
Growth is what happens to us.
Economic development is nurtured from within.
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