Made in Oregon: A Profile of the State’s Manufacturing SectorNovember 3, 2017 Oregon-made products have secured a spot on store shelves around the country, and even the world. Some of these products have obvious Oregon roots, tasty things like marionberry jam, cheese, fine wines, and beers that say ‘Oregon’ right on the label. Some Oregon-made products remain out of view, however. For example, components in the device you’re reading this article with might have been made right here in Oregon. Whether you can see it on the label or not, Oregon’s manufacturing sector produces products ranging from basic wooden pellets to precise aerospace parts. The diverse sector is a fundamental component of the state’s identity, and will remain so as it continues to grow.
A manufacturing establishment is defined as an establishment that mechanically, physically, or chemically transforms material, substances, or components into new products. In the second quarter of 2017, Oregon was home to 6,150 manufacturing establishments, providing the state with nearly 189,000 jobs.
Oregon’s manufacturing sector is growing more quickly than the nation’s. Since its lowest employment level in February and March 2010, manufacturing employment in Oregon has grown by 18.6 percent compared with the nation’s 8.7 percent. Over the year, Oregon saw manufacturing growth of 3.0 percent, higher than the nation’s 0.9 percent. However, as of September 2017 manufacturing employment in Oregon is still 16,200 jobs below its pre-recession peak in June 2006.
On top of faster growth, Oregon’s manufacturing sector is also a larger component of the economy than it is for the nation. While manufacturing made up 8.5 percent of payroll employment in the United States in September 2017, it made up 10.2 percent of Oregon’s employment.
Out of eight measured broad manufacturing industries, only two declined over the year and one hasn’t changed its employment level. Oregon’s top manufacturing industry, computer and electronic component manufacturing, declined 0.3 percent. Last year Intel announced a layoff of 784 workers at its Hillsboro site. As a share of manufacturing jobs, computer and electronic component manufacturing made up 19.0 percent of Oregon’s manufacturing jobs in September 2017. Nationally, computer and electronic component manufacturing represented 8.4 percent of all manufacturing jobs.
Transportation equipment manufacturing is another industry that declined 1.7 percent over the year. The employment in paper manufacturing didn’t change over the year. Another important industry in Oregon is wood product manufacturing, which made up 11.9 percent of manufacturing jobs in September 2017. It grew 2.2 percent compared with the nation’s 0.4 percent. Nationally, wood product manufacturing only made up 3.2 percent of manufacturing jobs.
A more detailed industry analysis shows just how diverse the manufacturing sector is. The largest detailed industry by far is the semiconductor and electronic components industry (29,900 jobs). It also pays far more on average than any other manufacturing industries ($142,000). Other high-paying industries on the list include electronic instrument manufacturing ($103,000) and aerospace product and parts manufacturing ($83,700).
True to Oregon’s long history in forestry, two of Oregon’s top industries are tied to our natural resources: veneer and engineered wood products (8,600 jobs) and sawmills and wood preservation (6,400 jobs). While employment in wood product manufacturing is but a fraction of what it was a few decades ago, these two industries combined play an influential role in Oregon’s manufacturing sector.
Two relatively low-paying industries in the top 10 largest manufacturing industries are frozen food manufacturing and bread and bakery product manufacturing. While these industries make up a large chunk of Oregon’s manufacturing sector, the jobs paid an average annual wage considerably lower than the statewide average wage of $49,500.
As more and more Oregon wines and beers hit shelves around the country and world, the winery and brewery industries are thrust into the spotlight. Both of these industries in Oregon have sizeable employment. Employment in wineries has risen steadily over the years, and is highly seasonal, due to employment spikes around harvest time. Brewery employment has skyrocketed in recent years as the craft beer industry has boomed.
Another notable industry in Oregon is the motor vehicle body and trailer manufacturing industry. This industry includes recreational vehicle manufacturers. Prior to the recession in 2007, this industry peaked at 4,800 jobs. After suffering massive losses during the recession, the industry was left with just under 2,000 jobs. Since then, employment has rebounded and steadily climbed to around 3,300 jobs.
For more information on detailed industries, visit QualityInfo.org where information is published on 125 detailed Oregon manufacturing industries.
Average wages in Oregon’s manufacturing sector have climbed steadily over the past 16 years. In 2016, the average annual wage for manufacturing in Oregon was about $67,500. This far exceeded the state’s average wage of $49,500. Looking deeper into Oregon’s manufacturing wages, this difference is largely attributable to wages in the computer and electronic product manufacturing industry, which paid an annual average of about $131,700 in 2016. Excluding computer and electronic product manufacturing, Oregon’s average wage across manufacturing industries was about $51,200, slightly higher the state’s average.
Long-Term Trends in Age
The manufacturing workforce in Oregon is aging more quickly than the workforce as a whole. Twenty years ago in 1997, 40 percent of Oregon’s workforce was between 14 and 34 years old. In manufacturing, about 37 percent of workers were between 14 and 34 years of age. In 2016, only 34 percent of the workforce was between 14 to 34 years old, while in manufacturing just 28 percent of workers were in this age group.
Workers ages 35 to 54 have a slightly lower share in manufacturing than 20 years ago. In the overall workforce, this group has declined in share over the past 20 years.
In both the overall workforce and the manufacturing workforce, workers in the 55 and over age group continue to make up a larger share as baby boomers pass into the 55 and older group. However, the manufacturing workforce has not had as many young workers enter as is the case for the overall workforce.
As workers retire, these positions will need to be filled by workers who have less experience in the field. This is true for both the overall workforce and the manufacturing workforce, but is more pronounced for the manufacturing workforce as fewer young workers have joined.
Short-Term Trends in Age
Over the past five years, the younger and older groups have gained the most jobs in the manufacturing sector. While the younger age group has decreased as a share of the manufacturing workforce by almost 9 percentage points in the past 20 years, the past five years have seen a small uptick in the share of young workers entering. The 55 and older group continues to see a modest growth in its share over the past five years.
After the recession ended, the youngest group of manufacturing workers, those 14 to 34 years old, grew by about 27 percent by the fourth quarter of 2016. The oldest group (55+) grew more quickly, at 32 percent, while the middle group (35-54) remained at the same level as in 2009. Overall, the industry grew by about 14 percent. It is important to note that in addition to the workforce adding jobs, the growth of these age groups can also be attributed to workers moving from one age group to the next.
Manufacturing workers in the youngest age group were most likely to be a part of beverage manufacturing in 2016. Workers in the 35 to 54 age group were most likely to belong to nonferrous metal production and processing, while those over 55 were most likely to work in engine, turbine, and power transmission equipment manufacturing.
The share of manufacturing workers by gender has remained unchanged for the past 20 years. In 1997, about 73 percent of the manufacturing workforce was male, and 27 percent female. These shares were the same in 2016, and remained almost exactly the same throughout the past two decades.
The Oregon Employment Department projects that the manufacturing sector in Oregon will grow by 11.8 percent between 2014 and 2024. Within manufacturing, food manufacturing is expected to grow quickest at 20.7 percent. The only broad manufacturing industry expected to lose employment is the paper manufacturing industry.
Nearly 62,000 job openings are expected between 2014 and 2024. While jobs are expected to grow by about 21,200, another 40,700 will open because current workers will need to be replaced, either due to retirements or job changes.
Occupations with the most projected job openings in manufacturing include managers of production and operating workers (2,300); general production workers (2,000); packaging and filling machine operators (1,800); welders, cutters, solderers and brazers (1,600); and team assemblers (1,500).
Oregon’s manufacturing sector is growing more quickly than manufacturing across the nation, and it is expected to continue doing so. Wages in the sector are higher than the statewide average, but after factoring out computer and electronic product manufacturing, are close to the statewide average. The share of manufacturing workers in older age groups continues to increase, even more so than the share across all industries.