A High, but not Particularly Concerning, Turnover Rate in Central Oregon

by Damon Runberg

May 6, 2019

Turnover or churn, the rate at which stable jobs end in a given quarter, is an oft discussed topic here in Central Oregon. Every quarter, around 12 percent of stable jobs end in Deschutes County. Statewide, that churn or turnover rate is closer to 10 percent. Why do we have a higher turnover rate of jobs here in Central Oregon? And is it something to be concerned about?

Looking at other metro areas across the state, we see that the Bend Metro area consistently posts a higher turnover rate. The gap between Bend and the state turnover rate from the last expansion through the recession and the current expansion has been about 2 percentage points to 3 percentage points. Remarkably consistent. Medford’s turnover rate is the nearest to Bend’s, yet the turnover rate down in the Rogue Valley is well over a percentage point lower.

The reason for the higher turnover rate is due to seasonality. Bend’s economy is much more seasonal than other metro areas across the state. If we look at the average turnover rate over the past decade for each quarter we see a large spike in the first and third quarter each year. What is going on here?

These seasonal spikes in turnover are largely a reflection of our industry composition. Bend is not a tourism-based economy, but tourism is a larger share of our local economy than other metro areas across the state. Around 17 percent of total private employment is concentrated in leisure and hospitality, the ninth highest share of Oregon’s 36 counties. The Bend metro area also has a relatively high share of total employment concentrated in construction, which is another highly seasonal industry, particularly here on the High Desert where winter weather disrupts construction projects to a larger degree than in communities in the Willamette Valley.

If we look at churn rate by quarter for our largest industries we see that tourism-related industries (arts, entertainment, and recreation; and accommodation and food services) have very high turnover rates. Turnover spikes in the first quarter after summer/ fall tourism jobs end. There is another smaller jump in the turnover rate during the third quarter when winter tourism jobs end. Construction has a similar pattern, but much less volatile. The turnover rate for our other major sectors in the region, such as health care and professional, have turnover rates consistent with the statewide pattern.

Ultimately, the Bend Metro’s high rate of turnover isn’t particularly concerning. First, this is not a new trend. For the past decade the pattern has been remarkably consistent. The slight upward trend in the turnover rate the past few years is common during expansionary periods where there are more voluntary separations due to a strong job market. Second, most of those whose seasonal jobs end don’t sit on the sidelines waiting for their seasonal job to return in three to six months. Recent research of ski resort workers in Oregon revealed that many of these winter tourism workers continue to work in Oregon in the summer months, but move into a summer-specific job, such as fighting fire, building homes, or guiding float trips. It’s a workforce that follows the seasons and moves relatively seamlessly from one job to another.

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