Northeast Manufacturing – Down but Not Out

by Christopher Rich

October 4, 2018

Northeast Oregon manufacturing lost 1,050 jobs from July 2006 to January 2010. The three county area (Baker, Union, and Wallowa) saw employment for the industry fall 40 percent, from a high of 2,620 to a low of 1,570. As of August 2018, Northeast manufacturing has regained just under half of jobs lost from 2006 to 2010.

The majority of jobs were lost from July 2007 to January 2009. During the next three years the industry remained stagnant. Seasonal growth pushed employment up by roughly 200 jobs through each July, and then seasonal losses brought employment back down by roughly the same amount through each January. The steepest portion of recovery thus far came from the beginning of 2012 through August 2014. The industry added 440 jobs for the two and a half year stretch or 88 percent of all jobs recovered to date.
As the industry tanked so did payroll. Manufacturing fed just over $87 million in wages into the Northeast’s economy in 2006. The industry’s total payroll was $24 million lighter in 2010. Even without total jobs recovery manufacturing’s payroll reached $94 million in 2017. Payroll growth put manufacturing’s 2017 payroll $7 million ahead of its 2006 payroll, not adjusted for inflation. Adjusting for inflation, however, reveals that payroll still needs to gain $11 million more to reach full recovery. A bright spot is that payroll recovery looks to be outpacing jobs recovery. The average annual wage for manufacturing in the Northeast was $35,298 in 2006. After adjusting for inflation, the average annual wage was $38,445 in 2017.

The total number of manufacturing firms was 72 in 2017, the same as in 2006. The low point was 64 firms in 2014. Although the industry had the same number of firms in 2017 as it did just prior to the recession, industry weight has shifted. There are fewer firms today with large employment rosters. Just 11 Northeast manufacturers had average annual employment of roughly 50 or greater in 2017; this is three fewer than in 2006. Several of the largest employers have yet to match prerecession levels, which may not occur due to restructuring and technology.   

Baker County’s 2017 manufacturing employment level was still 140 below the 2006 peak of 690. The low was 480 in 2013. Total payroll was $3.5 million above the peak in 2017 (unadjusted). Adjusted for inflation, payroll needs to pick up $980,000 to reach full recovery.  

Union County’s manufacturing employment was still down by 240 in 2017. The 2006 peak was 1,560. The low was 1,000 in 2009. Total payroll was $5.5 million above peak in 2017 (unadjusted). Adjusted for inflation, payroll needs to gain $7.5 million to reach recovery.

Wallowa’s manufacturing employment was still down by 70 in 2017. The 2006 peak was 220. The low was 120 in 2010. Total payroll has yet to move above the previous peak. Payroll remained $1.8 million below peak in 2017 (unadjusted). Adjusted for inflation, payroll needs to gain $3 million to reach recovery.

 


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