Manufacturing Employment in the Rogue Valley

by Guy Tauer

August 27, 2018

The Rogue Valley is home to a remarkable mix of manufacturing businesses whose products can be found in some of the planet’s deepest snows (Tucker Sno-Cat) to fighting its hottest forest fires (Erickson, Inc.). At one time it was wood products that employed the vast majority of local manufacturing workers. Even today, through all of the changes that the local wood products sector has undergone in the past few decades, it is still the dominant manufacturing player.

In 2017, the Rogue Valley’s 450 manufacturing businesses had about 10,700 jobs and total payroll exceeding $489 million. Manufacturing represents 9.4 percent of total Rogue Valley payroll employment. With average wages higher than the all-industry average, manufacturing accounts for 13.5 percent of total wages paid in 2017. Jackson County had more than 7,800 manufacturing payroll jobs, about 9 percent of payroll employment. Jackson County had a similar share of manufacturing jobs as Oregon statewide. Josephine County’s manufacturing payroll total was about 2,900. This represents about 10.7 percent of the county’s total payroll employment. In other words, Josephine County has a larger share of its total payroll employment in manufacturing than Oregon statewide.

Jackson County’s manufacturing average annual wage in 2017 was $47,421 compared to the all-industry average wage of $41,415. Josephine County’s manufacturing average wage of $40,660 was also higher than the all-industry average of $35,905. While Josephine County’s manufacturing wages were above its industry-wide average, Josephine had among the lowest average manufacturing wages among Oregon counties. Only Lake, Malheur, Umatilla and Wasco counties had lower average manufacturing wages per job than Josephine County in 2017.

When looking at these wage comparisons, it is helpful to remember that Oregon wages are largely influenced by the Portland metro area, as they have the majority of Oregon’s employment, including in manufacturing. The statewide average wage in manufacturing was $68,152 in 2017. One factor contributing to lower manufacturing wages in the Rogue Valley is the computer and electronic products industry. Oregon has about 37,400 of these jobs paying an average of almost $120,000. The Rogue Valley only has about 1.5 percent of the statewide total, or about 580 jobs in the computer and electronic product manufacturing industry. Computer and electronics accounts for about 20 percent of statewide manufacturing employment, but just 5.4 percent of Rogue Valley manufacturing jobs.

Wages also lag the statewide average with annual wages of about $53,200 in Jackson County and $65,600 in Josephine County. Not only is there a lower concentration of very high wage manufacturing jobs, average wages for most other manufacturing sub-sectors tend to pay lower in the Rogue Valley. Transportation equipment, apparel and wood products manufacturing industries in Jackson County have slightly higher average wages than Oregon statewide. All manufacturing sub-sectors in Josephine County pay less than the Oregon average.
Historical Job Growth Trends

There is no question that the Great Recession was a widely-felt economic event that many had not experienced in their lifetimes. During the housing boom-fed expansion of the 2000s, through the Great Recession and subsequent recovery, manufacturing growth rates were similar in Jackson County and Oregon statewide. Year-over-year job losses economy-wide reached a low point in early 2009, declining by more than 7 percent. During that time, statewide year-over-year declines exceeded 15 percent and plunged even further in Josephine County. Contributing to the drop in manufacturing jobs was the county’s reliance on so many businesses that were related to housing, building and construction-related goods. Josephine County manufacturing benefitted from the boom in housing and construction activity from the early 2000s through about 2007 when the housing bubble burst. Wood products, furniture, cabinets, home furnishings and related goods were all beneficiaries of the frenzied pace of construction and building activity until about 2006 or 2007 when the housing-fed boom began to implode. Many of those related manufacturing jobs, locally as well as economy wide, were lost. Josephine County experienced a feast, a famine, and thankfully a recent recovery in manufacturing employment, but is still not fully recovered from losses incurred during the deep recession.
In Jackson County, peak pre-recession manufacturing employment occurred in August 2007 when more than 7,900 were employed. By February 2010, employment fell precipitously to fewer than 6,000 jobs. By August 2017, a full decade after the prior peak, Jackson County regained the manufacturing jobs lost during the Great Recession. Josephine County reached peak pre-recession manufacturing employment in May 2006, when employment stood at about 3,600 jobs. Less than three years later, by February 2009, there were just 2,300 manufacturing jobs remaining in Josephine County. From 2010 to 2013, employment hovered at about 2,300 jobs. From early 2013 to early 2015, manufacturing employment recovered about 600 of the jobs lost during the recession. From mid-2015 through June 2018, Josephine County manufacturing employment hovered at about 3,000 jobs, still several hundred below the pre-recession peak reached a dozen years before.

As mentioned earlier, wood products was historically the backbone of the Rogue Valley’s manufacturing industry. Despite the steep job losses due to industry consolidation, less timber available from public lands, automation and modernization of wood products operations, and foreign competition, wood products accounts for the largest share – about one quarter -- of all manufacturing jobs in the Rogue Valley. Food manufacturing has the next largest share of the total, about one-in-six or about 15 percent of Rogue Valley manufacturing jobs. Transportation equipment accounts for about one-in-ten Rogue Valley manufacturing jobs.
Workers by Age

As is the case for the overall population and workforce, the manufacturing workforce in the Rogue Valley is getting older. Workers age 65 and older comprised only about one percent of the manufacturing workers in the early 1990s. Now more than five percent of manufacturing workers in the Rogue Valley are 65 years or older. This group increased from fewer than 200 workers in 1990s to more than 500 by the third quarter of 2017. Up until 1996, about 10 percent of manufacturing workers were 55 to 64 years old. By 2010, the percent doubled to about 20 percent, with the net increase going from about 900 to around 2,200 manufacturing workers in this baby-boomer cohort.

Looking at the younger age groups, we see the opposite trends. There were relatively sharp declines in the percent of Rogue Valley manufacturing workers age 35-44 and those 25-34 years old. In the early 1990s, about 28 or 30 percent of manufacturing workers were in both of these age groups. By 2017, the percent of local manufacturing workers in these groups declined to about 21 or 22 percent.
The Rogue Valley Manufacturing Gender Pay Gap

As is the case with many industries, women earn less than men in the Rogue Valley’s manufacturing industry sectors. Only in electrical equipment, appliance and component manufacturing did women earn more than men in the Rogue Valley. In furniture and related product manufacturing, as well as in wood product manufacturing, women earned about 90 cents for every dollar in male earnings. On the other end of the gender wage gap continuum, Rogue Valley women earned 33 to 63 cents for every dollar a male earned in transportation equipment, textile mill products, computer and electronic products, and leather and allied products manufacturing.
Outlook

The Rogue Valley’s manufacturing industry is expected to grow from 10,740 jobs in 2017 to 11,690 jobs by 2027, a gain of 950 jobs for a 9 percent growth rate. This is slightly slower than the all-industry average growth of 12 percent that is projected for the Rogue Valley. However, despite this tempered overall growth rate, there will be many more job openings due to replacement needs as workers retire, change major occupational groups, migrate to other areas, or leave the labor force for other reasons.

 


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