Narrative: II. a. 1. A.

NOTE: Tables and figures can be seen in the online version of the state combined plan at http://www.gwdc.org/wioa/index.html

WORKFORCE TRENDS

Over the last 50 years of the past century, our state and national economies benefited from a rapidly growing workforce, driven by the entry of baby boomers into their prime working years and by the dramatic rise in female labor force participation. These gains provided businesses with an adequate, and often surplus, pool of job seekers from which to draw. Between 1976 (when state–level measurement began) and 2001, Minnesota saw its labor force increase by nearly 993,000 workers, an average of just under 40,000 per year.

But those conditions began to change at the turn of the century as the first baby boomers reached age 55 and female participation rates levelled off. Between 2001 and 2015, our labor force growth slowed to an average of about 12,000 new workers per year, a rate less than a third that of the prior 25 years.

This slowing growth will be the defining characteristic will challenges us in the years to come. The U.S. Census Bureau estimates that there will be nearly 50,000 more Minnesota residents who will reach the age of 65 by 2030 than there are youth who will reach 16 by that time. So if we had to rely solely on our existing populace, Minnesota would see its prime working age population fall by 50,000 by 2030. These estimates clearly show that the number of people available through natural growth in our working age population will fall well short of the needs of businesses looking to grow. (Table 1)

Table 1. Minnesota’s Labor Force Projections, 2015–2030

–	2015 Labor Force Projection	2030 Labor Force Projection	2015–2030 Change Numeric	2015–2030 Change Percent
16–19 years	139,938	153,866	+13,928	+10.0%
20–24 years	274,329	267,537	–6,792	–2.5%
25–44 years	1,245,784	1,280,645	+34,861	+2.8%
45–54 years	661860	643,042	–18,818	–2.8%
55–64 years	535,988	487,175	–48,813	–9.1%
65–74 years	126,182	200,349	+74,167	+58.8%
75 years & over	20,845	34,587	+13,742	+65.9%
Total Labor Force	3,004,926	3,067,201	+62,275	+2.1%

Source: Minnesota State Demographic Center

Thanks to the sharp rise in the number of older workers, Minnesota’s State Demographic Center projects that our workforce will expand by an average of just over 4,000 people per year over the next 15 years (see Table 1). That growth is one–tenth what we averaged between 1976 and 2001, and one–third the rate we experienced since 2001. However, these projections assume that participation rates in our older age groups will experience increases over the next 15 years. If these participation rate increases do not occur and instead hold constant at current participation rates for workers 55 and above, our labor force would shrink over the next 10 years by about 11,000 before finally starting to grow by 21,000 between 2025 and 2030. This would further reduce total labor force gains to a total of 10,000 over the next fifteen years, a growth we used to experience every three months during the 1980s and 1990s.

Alongside this dramatic slowdown and projected graying of our state’s workforce is another significant change in our state’s demographic makeup that has long been under way: increased racial diversity among our working age population. Over the past 15 years, Minnesota’s white population has grown by 4.2 percent while its populations of color have grown at rates far exceeding that, including our black (69.2%), Asian (61.8%) and Hispanic (84.3%) populations (see Table 2).

Table 2. Race and Hispanic Origin, 2014

–	Number (MN)	Percent (MN)	Change from 2000–2014 (MN)	Percent (US)	Change from 2000–2014 (US)
Total	5,383,661	100.0%	+9.4%	100.0%	+11.6%
White	4,585,781	85.2%	+4.2%	73.8%	+9.6%
Black or African American	290,545	5.4%	+69.2%	12.6%	+14.2%
American Indian & Alaska Native	56,490	1.0%	+2.8%	0.8%	+3.6%
Asian & Other Pac. Islander	232,964	4.3%	+61.8%	5.2%	+52.7%
Some Other Race	78,863	1.5%	+19.8%	4.7%	–3.9%
Two or More Races	139,018	2.6%	+68.0%	2.9%	+33.7%
Hispanic or Latino	264,265	4.9%	+84.3%	16.9%	+50.3%

Source: U.S. Census Bureau, 2010–2014 American Community Survey

These changes are expected to continue and even accelerate in the coming years, especially among those Minnesotans of working age.

To illustrate the magnitude of these changes, consider that the number of white Minnesotans between the ages of 18 and 64 fell by 6,875 between 2013 and 2014, while the number of black Minnesotans within that age range rose by about 10,500 and the number of Minnesotans reporting their race as something other than white alone increased by nearly 28,000.

The reasons for these stark differences in the growth of working age populations by race are at least twofold: First, the white population is “aging out” into its retirement years at a much faster rate than our minority population. Second, there continues to be a significant influx of foreign–born immigrants who are typically in that working age cohort. Again using 2013 to 2014 as an example, the number of foreign–born blacks of all ages well over 90 percent of whom come from Africa, increased by about 14,000.

The State Demographic Center projects that between now and 2030, our minority population will grow by 37.3 percent, while the white alone population will grow by 4.1 percent, most of which will be 65 and older. While it is difficult to project the racial breakout of our workforce 15 years from now, especially as much of the growing diversity is driven by foreign immigration, it is clear that what little growth we are likely to see in our workforce will come in large part – if not entirely from – our minority workers.

Despite long–standing awareness that our populations of color generally, and our black community in particular, have failed to benefit fully from an improving economy, disparities persist and by many measures have worsened. According to 2015 Current Population Survey data, even after six years of economic recovery, Minnesota’s unemployment rate among blacks stood at 14.1 percent while the rate for whites was 2.9 percent. This ratio of black to white unemployment was the worst disparity in the nation! At the same time, our black labor force participation rate stood at 91 percent of the white rate, a ratio that was third worst among the 50 states.

To illustrate the impact that minorities will have on our labor force growth, suppose the black workforce grows at the projected 33.6 percent rate between now and 2030. This would increase the number of blacks in our labor force from its current 148,780 to 198,770. Also suppose we were able to close the gaps between black and white participation rates and unemployment rates so that, in 2030, they are both at the current rates held by whites. This would result in an annual increase in our employment growth by nearly 1,400 over each of the next 15 years, which adds up to over 20,000 additional workers.

Similarly, increasing labor force participation rates and reducing unemployment rate disparities for other race groups, people with disabilities, both younger and older workers, and people with lower educational attainment would lead to notable increases in the size of the state’s available labor force. Helping minorities and other groups with barriers to employment will be critical to ensuring that Minnesota’s employers are able to find workers and our economy is able to continue growing.

This will be especially important in Greater Minnesota, which has an older population than the Twin Cities, with 16.4 percent of the population aged 65 years and over, compared to 11.8 percent in the metro area. Greater Minnesota also has a lower percentage of people in the prime working years, as well as much less racial diversity than the Twin Cities.

While every region in the state saw an increase in the number of jobs held by minorities over the past 20 years, only 8 percent of jobs in Greater Minnesota are held by minorities, compared to 18 percent in the Twin Cities. Outside the metro area, the most diverse workforces are found in the Southeast and Southwest regions of the state, while the Northeast has the least diverse workforce overall. However, the racial disparities in unemployment are found in every region throughout the state, making it an opportunity for growth regardless of location.

In sum, the data show that current population and aging trends will lead to a tight labor market over the next two decades – with some local areas already experiencing labor force declines. The challenges our state will face over the next 15 years are so great that we’ll need to tackle them with a multi–pronged approach to attract and retain workers of all demographic characteristics. Retaining older workers beyond traditional retirement age, attracting and retaining young talent, removing barriers faced by workers of all abilities, welcoming immigrants from other countries, and educating and training the workers we do have are all necessary to overcome these challenges.

Because minority populations in Minnesota will continue to grow faster than the white population, particularly in the younger working age populations, the labor force will continue to diversify rapidly. Recognizing that the rapidly increasing share of existing workers are people of color, it becomes obvious that we must address this problem of persistent racial disparities directly.

If these disparities continue unabated, disadvantaged groups won’t be the only ones who suffer. Businesses and the economic well–being of every resident of our state also will be affected. So working on solutions to close these racial gaps between our state’s white population and its populations of color is not only the right thing to do, it’s the necessary thing to do if we’re to provide our economy and its employers with the workforce necessary for success.

LABOR FORCE PARTICIPATION AND UNEMPLOYMENT RATES

Regardless of the state of the economy, Minnesota has consistently reported lower unemployment rates than the United States as a whole. According to Local Area Unemployment Statistics, Minnesota’s unemployment rate hovered just below the national rate from 2005 to 2008, before rising as high as 7.8 percent in 2009, then dropping back to pre–recession levels by 2014 (see Figure 1). Within the state, the Twin Cities, Southeast and Southwest had the lowest rates in 2015, while the highest rates have consistently been found in Northern Minnesota. (Table 3)

Table 3. Employment Characteristics, 2014

–	Number (MN)	Labor Force Partic. Rate (MN)	Unemp. Rate (MN)	Labor Force Partic. Rate (US)	Unemp. Rate (US)
Total Labor Force	2,977,637	70.1%	6.5%	63.9%	9.2%
16 to 19 years	148,882	51.1%	18.7%	37.4%	27.1%
20 to 24 years	292,121	81.8%	10.2%	73.6%	15.3%
25 to 44 years	1,239,120	88.1%	5.8%	82.3%	8.4%
45 to 54 years	685,555	87.3%	5.0%	80.4%	7.0%
55 to 64 years	486,134	71.8%	4.9%	64.3%	6.6%
65 to 74 years	104,315	26.6%	4.1%	25.3%	6.2%
75 years & over	19,955	5.9%	3.5%	6.0%	5.7%
Employment Characteristics by Race & Hispanic Origin	–	–	–	–	–
White alone	2,607,068	70.2%	5.6%	63.8%	7.9%
Black or African American	137,313	68.0%	16.4%	62.2%	16.1%
American Indian & Alaska Native	24,118	59.4%	17.4%	58.9%	15.9%
Asian or Other Pac. Islanders	121,498	70.6%	7.2%	65.4%	7.1%
Some Other Race	39,691	76.2%	11.0%	69.5%	11.6%
Two or More Races	46,714	69.5%	13.2%	65.2%	13.4%
Hispanic or Latino	125,615	75.0%	10.1%	67.5%	11.0%
Employment Characteristics by Veteran Status	–	–	–	–	–
Veterans, 18 to 64 years	141,601	77.7%	6.9%	75.2%	6.2%
Employment Characteristics by Disability	–	–	–	–	–
With Any Disability	136,879	51.0%	14.0%	41.3%	17.8%
Employment Characteristics by Educational Attainment	–	–	–	–	–
Population, 25 to 64 years	2,409,831	84.0%	5.4%	77.6%	7.7%
Less than H.S. Diploma	116,282	65.8%	13.1%	60.9%	14.0%
H.S. Diploma or Equivalent	532,306	79.1%	7.3%	73.3%	9.9%
Some College or Assoc. Degree	852,521	85.3%	5.6%	79.5%	7.9%
Bachelor’s Degree or Higher	909,603	89.2%	3.1%	86.0%	4.1%

Source: 2010–2014 American Community Survey, 5–Year Estimates

Minnesota has much higher labor force participation rates than the United States, ranking third highest in the nation in 2014. By age, Minnesota has higher labor force participation rates than the nation in all but the oldest age group, and had lower unemployment rates for all age groups (see Table 3). While participation rates are dropping overall, most notably in the 16 to 54 year age groups, rates in the older age cohorts may increase over the next 10 years.

Although we have higher labor force participation rates than the nation for every race group, Minnesotans that are black, American Indian, or two or more races have higher disparities in participation when compared to whites than exist nationwide. Minnesota also has larger unemployment disparities in all minority groups, which could be a potential source of workers moving forward if rates improve.

One–year estimates from the 2014 American Community Survey show that unemployment rates were also higher for younger people, especially those from 16 to 24 years of age, and for people with lower educational attainment. In 2014, people with less than a high school diploma had an unemployment rate of 9.4 percent, compared to high school graduates at 5.6 percent, people with some college or associate’s degrees at 3.6 percent, and workers with a bachelor’s degree or higher, at 2.2 percent.

About 314,000 of Minnesota’s working age population (between the ages of 16 and 64) have disabilities. Altogether, nearly 140,000 people with disabilities are in Minnesota labor market. However, their rate of unemployment, at 14 percent, far exceeds the overall unemployment rate in Minnesota (the comparable number was 6.5 percent for the same time period). People with disabilities also have a much lower labor force participation rate than the general population, at 51 percent compared to 70 percent. Over 60 percent of workers with disabilities work in the private sector although the non–profit sector has the highest concentration of disabled workers at 9.4 percent of its total workforce in Minnesota.

Minnesota’s veterans have a higher unemployment rate than nonveterans, but they have a higher participation rate than nonveterans as well. Moreover, their unemployment rate has been trending down in comparison to the overall unemployment rate over the past few years.

While no population level employment data exists for ex–offenders in Minnesota, an estimated three–fourths of ex–offenders nationwide remain jobless up to a year after release. Applying this share in Minnesota, about 5,730 of the 7,640 inmates released from Minnesota’s prisons in 2014 remained unemployed in 2015. While this high unemployment rate is in part driven by employers’ reluctance to hire them, this population is also impacted by very low educational attainment as well as employment gaps and lack of workforce experience due to their absence from the labor force while in prison.

HOUSEHOLD INCOMES, WAGES AND COST OF LIVING

Household incomes are higher in Minnesota than the nation. In 2014, Minnesota’s median household income was $60,828, compared to $53,482 for the U.S. Just over 41 percent of households in Minnesota had incomes below $50,000 in 2014, compared to about 47 percent nationwide. One–third of households in Minnesota earned between $50,000 and $100,000, compared to 30 percent nationally. More than one–fourth of households in Minnesota earn more than $100,000 per year, compared to 23 percent of households in the nation (see Figure 2).

However, not all race groups enjoyed the same level of prosperity. Incomes were lower for minority households, with the exception of Asians. The median income for blacks dropped to $27,026 in 2014, well below the national median and less than half of the median income for white households. American Indians and people of some other or two or more races also had lower incomes compared to whites (see Figure 3). Incomes were also lower in Greater Minnesota, with just under half of households earning below $50,000 per year, compared to less than 40 percent of households in the Twin Cities.

As calculated using DEED’s Cost of Living tool, the basic needs budget for an average family – which consists of two adults and one child with one full–time worker and one part–time worker – was $50,988 in 2015. Workers in this family scenario would need to earn $16.34 per hour to meet a basic cost of living (see Table 4).

Table 4. Family Yearly Cost, Worker Hourly Wage, and Family Monthly Costs, 2015

Region	Family Cost of Living (yr)	Wage Required (hr)	Child Care (mo)	Food (mo)	Health Care (mo)	Housing (mo)	Transportation (mo)	Other (mo)	Taxes (mo)
Minnesota	$50,988	$16.34	$443	$772	$405	$907	$1,039	$235	$448
Twin Cities	$55,896	$17.92	$602	$783	$411	$1,022	$1,037	$252	$551
Central	$49,884	$15.99	$311	$753	$402	$861	$1,175	$226	$429
Northeast	$43,560	$13.96	$245	$758	$393	$764	$968	$213	$289
Northwest	$43,464	$13.93	$220	$760	$399	$700	$1,047	$204	$292
Southeast	$45,300	$14.52	$285	$761	$396	$794	$987	$218	$334
Southwest	$41,352	$13.25	$209	$766	$398	$701	$933	$205	$234

Source: DEED Cost of Living tool

In comparison, the median hourly wage for all jobs in the state was $18.65 in the first quarter of 2015, ranging from a low of $15.42 in Northwest Minnesota to a high of $20.49 in the Twin Cities. Median wages for all regions are higher than the wage required to meet a basic needs (see Table 5).

Table 5. Occupational Employment Statistics by Region, 2015

–	Cost of Living	Median Hourly Wage	Estimated Regional Employment
State of Minnesota	$16.34	$18.65	2,730,020
Twin Cities Metro Area	$17.92	$20.49	1,691,650
Central Minnesota	$15.99	$16.66	263,270
Northeast Minnesota	$13.96	$16.58	141,800
Northwest Minnesota	$13.93	$15.42	203,060
Southeast Minnesota	$14.52	$17.74	253,990
Southwest Minnesota	$13.25	$15.48	177,030

Source: DEED Cost of Living, Occupational Employment Statistics

However, there is still a portion of households that are living on wages that are below the regional cost of living.

Even as Minnesota’s workplace continues to diversify, the growth rate of minority worker wage income has lagged behind minority employment growth. Wage growth lower than job growth is another way of saying the minority employment increase over the last two decades has occurred disproportionately in lower paid jobs.

The minimal improvement in the average gain for minorities shows that there hasn’t been much change in the wage mix of jobs held by minorities over the last two decades. While the share of all jobs held by minority workers increased from 7.4 percent two decades ago to 14.2 percent in 2014, the share of total wage income paid to minority workers increased from 5.5 to 10.7 percent. There has been almost no decline in the wage gap for minority groups in Minnesota, despite the minority workforce accounting for an expanding share of the state’s workforce.

Even looking only at workers who have recently graduated from college, minorities are more likely to be found in lower wage industries than whites, and minorities are less likely to be working in a job related to their field of study. Increasing the diversity of workers within moderate and high paying industries could improve minority worker earnings, particularly over time.

JOB VACANCIES AND OCCUPATIONS IN DEMAND

Employers in Minnesota reported 98,000 job vacancies in the second quarter of 2015, which is the second highest number ever recorded, and more than three times the number reported during the recession. Statewide, there were now just 1.2 unemployed people for each vacancy, which is the third lowest ratio on record and suggests that the labor market remains tight as baby boomers retire and job growth continues at a moderate pace (see Figure 4).

The economy has improved across the state, with employers in the Twin Cities reporting 50,880 vacancies, while Greater Minnesota had 47,117 vacancies – nearly four times more than during the recession. As such, employers have reported challenges finding qualified workers for their openings, but DEED research demonstrated that some of these hiring difficulties also come from demand side factors such as uncompetitive wages, unattractive locations or work shifts, or limited recruiting strategies.

The Minnesota Department of Employment and Economic Development’s Occupations in Demand tool shows hundreds of occupations with relatively high demand across Minnesota, with training and education requirements ranging from short–term, on–the–job training to post–secondary education to advanced degrees. These occupations are spread across different sectors in each region, typically concentrated in major industries. For example, food prep workers, customer service representatives, registered nurses, and software developers are among the top occupations in demand based on the consistent need for workers in different industries. Much of the current demand is found in health care, retail trade, accommodation and food services, educational services, and manufacturing.

Minnesota is projected to see job growth of 7.0 percent from 2012 to 2022, compared to 6.2 percent in Greater Minnesota and 7.6 percent projected growth in the Twin Cities. That’s a gain of 204,999 new jobs statewide. Minnesota will also need to fill 673,520 openings for existing jobs left vacant by retirements and other career changers. The number of replacement openings is expected to dwarf the number of new jobs in every group except personal care and service, health care, health care support, and construction (see Figure 5).

INDUSTRY TRENDS AND PROJECTIONS

Minnesota ended 2014 with 126,815 more jobs than it had in 2004. Since the 2008 recession, Minnesota has enjoyed a solid recovery, adding more than 166,000 jobs for a growth rate of 6.5 percent over the five year period from 2010 to 2014. Employment in the Twin Cities grew 6.8 percent, up 104,500 jobs, while Greater Minnesota expanded 6 percent, adding 61,500 jobs over the period (see Figure 6).

Central Minnesota was the fastest growing region of the state, while the Twin Cities saw the largest amount of growth. Both Northeast and Southwest Minnesota had not recovered all of the jobs lost during the recession, while Northwest and Southeast had seen steady job growth.

Statewide, Minnesota was home to 164,409 businesses providing 2,729,438 jobs through 2014, with a total payroll of just over $140 billion. Nearly 60 percent of statewide employment is located in the Twin Cities metro region. Average annual wages are $51,584 across the state, but are about $7,000 higher in the Twin Cities and about $10,000 lower in Greater Minnesota (see Table 6).

Table 6. Minnesota Industry Employment, 2014

Geography	Number of Firms	Number of Jobs	Total Payroll	Average Annual Wage	Change in Jobs 2010–2014	Percent Change 2010–2014	Change in Jobs 2013–2014	Percent Change 2013–2014
State of Minnesota	164,409	2,729,438	$140,857,248,755	$51,584	+166,047	+6.5%	+37,321	+1.4%
Greater Minnesota	86,055	1,087,891	$45,405,206,957	$41,737	+61,541	+6.0%	+16,204	+1.5%
Twin Cities Metro	78,354	1,641,547	$95,452,041,798	$58,136	+104,506	+6.8%	+21,117	+1.3%

Source: DEED Quarterly Census of Employment & Wages (QCEW)

Health care and social assistance is easily the largest employing industry in Minnesota, accounting for 16.7 percent of total employment. Manufacturing is the second largest industry in the state, and Greater Minnesota has a much higher concentration of manufacturing employment than the Twin Cities. Retail trade and the related accommodation and food services industry provided about 19 percent of total jobs in the state, while educational services is the fifth largest industry. Other important industries include public administration, professional and technical services, finance and insurance, administrative support and waste management services, wholesale trade and construction.

The recovery was widespread, with 19 of the 20 industries adding jobs since 2010, led by huge gains in health care and social assistance, manufacturing, construction, professional and technical services, administrative support (which includes temporary staffing agencies) and waste management services, management of companies, and retail trade and accommodation and food services (see Table 7).

Table 7. Minnesota Industry Employment Statistics, 2014

Number of Firms 2014 Annual Data	Number of Jobs 2014 Annual Data	Percent of Jobs 2014 Annual Data	Total Payroll 2014 Annual Data	Avg. Annual Wage	Change in Jobs 2010–2014	Percent Change 2010–2014	Change in Jobs 2013–2014	Percent Change 2013–2014
164,409	2,729,438	100.0%	$140,857,248,755	$51,584	+166,047	+6.5%	+37,321	+1.4%
14,048	454,738	16.7%	$21,144,800,181	$46,488	+34,722	+8.3%	+7,951	+1.8%
8,012	311,905	11.4%	$19,053,127,782	$61,048	+19,702	+6.7%	+4,677	+1.5%
18,871	288,966	10.6%	$7,850,864,668	$27,144	+10,591	+3.8%	+2,059	+0.7%
11,301	219,895	8.1%	$3,652,205,389	$16,588	+15,795	+7.7%	+2,903	+1.3%
3,924	218,818	8.0%	$10,101,891,266	$46,072	+3,489	+1.6%	+449	+0.2%
19,887	141,749	5.2%	$11,885,980,709	$83,772	+16,964	+13.6%	+4,999	+3.7%
9,167	136,563	5.0%	$12,716,330,442	$93,132	+1,916	+1.4%	–3,343	–2.4%
7,889	135,522	5.0%	$4,591,154,568	$33,852	+12,335	+10.0%	+843	+0.6%
13,523	132,011	4.8%	$10,164,289,250	$77,012	+8,117	+6.6%	+1,428	+1.1%
3,295	126,331	4.6%	$6,472,785,850	$51,220	+966	+0.8%	+2,509	+2.0%
16,189	114,283	4.2%	$6,731,579,149	$58,760	+19,115	+20.1%	+6,919	+6.4%
5,460	96,040	3.5%	$4,708,374,157	$48,984	+4,121	+4.5%	+2,708	+2.9%
15,741	87,371	3.2%	$2,618,499,566	$29,952	+4,235	+5.1%	+1,955	+2.3%
1,319	78,676	2.9%	$9,075,988,953	$115,336	+8,037	+11.4%	+1,728	+2.2%
3,477	56,371	2.1%	$3,821,807,951	$67,756	–1,537	–2.7%	–662	–1.2%
3,036	49,508	1.8%	$1,492,026,464	$30,264	+1,007	+2.1%	+500	+1.0%
6,055	39,461	1.4%	$2,166,060,466	$54,964	+3,380	+9.4%	–298	–0.7%
2,569	20,565	0.8%	$700,305,798	$33,956	+2,018	+10.9%	–39	–0.2%
422	14,280	0.5%	$1,363,564,607	$95,576	+202	+1.4%	–123	–0.9%
227	6,382	0.2%	$545,611,539	$85,540	+1,159	+22.2%	+159	+2.6%

Source: DEED Quarterly Census of Employment & Wages (QCEW)

As noted, Minnesota’s economy is expected to grow 7 percent from 2012 to 2022, a gain of 204,999 jobs. The largest and second–fastest growing industry will be health care and social assistance, which may account for 46 percent of total projected growth from 2012 to 2022.

The state is also projected to see fast job growth in construction, professional and technical services, administrative support and waste management services, retail trade, accommodation and food services, finance and insurance, and wholesale trade. These industries will need to focus on attracting and recruiting new workers to fill their needs. In contrast, the state is expected to see job cuts in public administration, utilities, manufacturing, and information (see Table 8).

Table 8. Minnesota Industry Projections, 2012–2022

Industry	Estimated Employment 2012	Projected Employment 2022	Percent Change 2012–2022	Numeric Change 2012–2022
Total, All Industries	2,915,401	3,120,400	+7.0%	+204,999
Health Care & Social Assistance	410,004	503,800	+22.9%	+93,796
Construction	94,835	118,520	+25.0%	+23,685
Professional & Technical Services	130,505	149,410	+14.5%	+18,905
Admin. Support & Waste Mgmt.	131,644	148,610	+12.9%	+16,966
Retail Trade	283,040	293,860	+3.8%	+10,820
Accommodation & Food Services	205,312	215,630	+5.0%	+10,318
Finance & Insurance	138,413	147,150	+6.3%	+8,737
Wholesale Trade	128,759	134,860	+4.7%	+6,101
Educational Services	54,652	59,800	+9.4%	+5,148
Other Services	124,752	129,750	+4.0%	+4,998
Arts, Entertainment &Recreation	51,767	56,010	+8.2%	+4,243
Real Estate, Rental & Leasing	38,873	42,920	+10.4%	+4,047
Management of Companies	74,576	76,740	+2.9%	+2,164
Agriculture, Forestry, Fish & Hunt	24,423	25,060	+2.6%	+637
Mining	6,242	6,760	+8.3%	+518
Transportation & Warehousing	79,203	79,655	+0.6%	+452
Public Administration	373,564	372,520	–0.3%	–1,044
Utilities	12,699	11,620	–8.5%	–1,079
Manufacturing	305,607	301,530	–1.3%	–4,077
Information	53,526	49,400	–7.7%	–4,126

Source: DEED 2012–2022 Employment Outlook

By industry sector, minorities were most likely to hold jobs in administrative and support services, health care and social assistance, and accommodation and food services, which are all lower–wage industries. People of color were underrepresented in mining, utilities, construction, wholesale trade, agriculture, education services, finance and insurance, public administration, professional and technical services, management of companies and information, most of which are higher–wage industries. Increasing the diversity of workers within moderate and high paying industries could improve minority worker earnings and incomes (see Figure 7).

Supporting minority owned firms is another way to increase minority earnings and employment opportunities. For many Minnesotans of color, starting a small business enables them to step out of a traditional job and pursue their career passion. Likewise, many immigrant families see businesses as a way to become self–sufficient and provide a necessary – and often missing – service to their community.

However, minority–owned firms account for just 9.7 percent of all firms in Minnesota, compared to 28.9 percent of all firms nationwide. Just 1.8 percent of firms in Minnesota were owned by Hispanics in 2012, compared to 12.0 percent of U.S. firms (see Table 9).

Table 9. Characteristics of Minnesota Businesses, 2012

–	Total Number of All Firms	Total Sales of All Firms ($1,000s)	Number of Firms with Paid Employees	Sales of Firms ($1,000s) with Paid Employees	Number of Paid Employees	Annual Payroll ($1,000s) of Firms with Paid Employees	Number of Firms without Paid Employees	Sales of Firms ($1,000) without Paid Employees
All Firms	489,494	694,788,651	109,736	677,657,170	2,422,065	113,609,544	379,758	17,131,480
Minority–owned Firms	47,565	8,722,470	5,651	7,619,296	63,360	1,765,131	41,913	1,103,174
Black or African American	19,964	1,729,430	1,155	1,324,500	21,261	515,770	18,809	404,930
American Indian or Alaskan Native	4,152	724,233	456	683,316	6,402	206,312	3,696	85,907
Asian	15,553	4,163,621	2,995	3,774,405	27,255	720,977	12,558	389,216
Native Hawaiian and Other Pacific Islander	328	65,151	44	57,161	407	7,239	284	8,000
Some other race	3,806	502,498	340	397,280	2,194	67,020	3,465	105,218
Hispanic–owned Firms	8,865	1,940,095	1,009	1,687,202	8,174	296,089	7,856	252,893

In some instances, detail categories may not add to total due to rounding or because a Hispanic firm may be of any race. Moreover, each owner had the option of selecting more than one race and therefore is included in each race selected.

Source: U.S. Census Bureau, Survey of Business Owners, 2012

Despite the relatively low numbers, minority–owned firms are growing in number much faster than white owned firms in Minnesota. While white–owned firms declined between 2007 and 2012, minority–owned firms grew by 60.3 percent in Minnesota with revenues up 88.5 percent over the period.

Our focus is on targeting and increasing our service capacity to Minnesotans with barriers to employment. In 2014, Minnesotans of color made up 19 percent of the state’s population. Individuals from communities of color currently make us one in every four individuals served in our workforce system through universal services and eligibility–based program. Given the well–documented and unequal unemployment rates by race and ethnicity, we can do more to ensure that communities most in need have access to and participate in our workforce system.

This access and participation must also extend to Minnesotans with disabilities and disconnected youth. In 2014, nearly 11 percent of Minnesotans have a disability. These statistics are even greater for the state’s Black or African American and American Indian residents. And unemployment rates for individuals with a disability exceed state averages in Minnesota.

Finally, while measures show that Minnesota has the 4th lowest rate among states for disconnected youth – those age 16 to 24 who are neither working nor in school – rates of disconnection are disproportionate by race and ethnicity. Minneapolis–St. Paul metro data show a 16.6 percent disconnection rate among Black of African Americans versus 7.7 percent for whites.

Regional profiles have been made available to each of the workforce development regions. Additional information and analysis will be provided to each region as requested.