Region’s top 25 employers report stable work force

Bobbie Maynard
Wednesday, Jan 3, 2007

Looking at a roundup of this past year’s top employers, manufacturing and service-related jobs are almost split evenly, which correlates with similar statistics from 2005. Of the UC’s top employers, none reported plans of layoffs or downsizing. In fact, the majority reported “stable” work force numbers with some companies announcing plans for hiring more employees.

To give a better perspective on the UC’s top employers, the CBJ reviewed and confirmed data submitted by local chambers of commerce and county executive offices concerning top employers for each county. That data was compiled into a “Top 25 Employers” list for the region (found on page 16).

One key difference between this year’s list compared with the one from 2005 is that the CBJ removed county school systems from 2006’s Top 25 Employers List in order to give a more accurate listing of top manufacturing employers. A separate sidebar chart comparing county school systems is included on page 16.

Manufacturing Versus Service Jobs

A snapshot of work force statistics concerning this year’s Top 25 found that manufacturing once again edged out the service sector with 53.4 percent of jobs. Service-related jobs in the region, including Tennessee Tech University, retail, health care and transportation/logistics employers, account for 46.6 percent of the Top 25. As an industry, health care provides for 15.1 percent of jobs found on the list.

Even though manufacturing jobs are prevalent in the Top 25, service-related jobs outpace manufacturing by a 3-to-1 ratio across the UC’s 15-county region. According to analyst Henry Bowman of the Upper Cumberland Development District, the latest regional numbers show 27,600 goods-producing jobs compared with 73,750 service-producing jobs for the area. Goods-producing jobs include construction, mining and light manufacturing.

“Those numbers, which are the latest from October 2006, show a change since 2005,” explained Bowman. “For the same month in 2005, we had 31,100 goods-producing jobs and 72,030 service-producing jobs. So our region continues to follow a national trend of fewer manufacturing jobs.”

The Bureau of Labor Statistics, which is under the U.S. Department of Labor, reports that in the economy as a whole, manufacturing represents only 11 percent of all employment. The average hourly earning of production workers in manufacturing were $16.56 in 2005.

As a norm, wages in general for the UC fall behind national and state averages because the UC’s cost of living is lower. When it comes to manufacturing wages, one study conducted by Middle Tennessee State University found that wage intensity is related to specific types of manufacturing. For example, high wages in manufacturing are found in chemical, computer, petroleum and transportation industries, whereas low wages are found in wood products, furniture and textiles. Medium technology employment, which has the largest presence in Middle Tennessee manufacturing, is found primarily in scale-intensive industries, such as transportation, plastics and primary metals.

The Bureau of Labor Statistics also projects that manufacturing employment will decrease nationally by 5.4 percent over the 2004-14 period. The U.S. Department of Agriculture’s Economic Research Service reports that rural areas, which have historically attracted businesses with low wages and reliable workers, now face competition from even lower wages overseas. Many rural industry staples, such as garment and footwear manufacturing, have now moved offshore.

But the gap that had once opened up in American manufacturing moving offshore may be diminishing.

“It’s just a feeling, but we may be past the worst when it comes to the losses seen in past years related to manufacturing,” said Bowman. “I think nationally those losses are declining. We’re going to see growth from smaller manufacturers that are more adaptable and quicker to adjust production needs to be efficient.”

Interesting Trends Relative To Job Market

As a region, the UC experienced fewer job losses in 2006 than in 2005. According to the state’s Department of Labor and Workforce Development, statistics from the Dislocated Worker Unit indicate the region lost an estimated 1,400 jobs in 2006, compared with 2,900 in 2005.

“In 2005, Warren and White counties were hit hard by the losses of Carrier and Emerson,” said Bowman. “This year, probably the largest manufacturer to leave the region was Russell Stover Candies that phased out production at its Cookeville plant.”

Russell Stover Candies previously ranked as number 19 on 2005’s Top 25 Employers List. The company announced last summer the permanent mass layoff of 400-plus employees.

Bowman noted that even with the economic downturns that accompany job losses, many UC counties’ state sales tax collections remained unexpectedly high.

“Surprisingly, sales tax collections have held up very well,” said Bowman. “Putnam County in particular has been very strong.”

The largest sales tax gains from October 2005 to October 2006 were found in Fentress (19.3 percent), Jackson (15.0 percent) and Putnam (12.1 percent) counties. Fentress County’s gains can be attributed in part to the opening of a new Wal-Mart Supercenter last spring.

Job Growth Across The UC

Although small to medium businesses bring in additional employees and new hires every day, the CBJ estimates that large employers for the region added upwards of 1,000 new jobs to the UC’s economy in 2006, especially with the recent December announce-ment by Oreck Corp. to relocated all of its manufacturing work to Cookeville. Those regional job additions are attributed to new company relocations and existing industry expansions.

According to the Bureau of Labor Statistics, the top five fastest growing industries nationally are educational support services (private); home health care services; software publishers; manufacturing, scientific and technical consulting services; and community care facilities for the elderly. Two of those industries – education and health care – are also among the top employers projected for fast growth in the UC.

“Our fastest growing service area is the medical/health care field,” explained Bowman. “That can be related in part to our growth as a retiree destination because older people require more care in general.”

Bowman also said that education plays an important role in the job market in terms of employment, but that education’s growth is tied to population.

“It’s hard to nail down the growth seen in the education and government fields because it’s tied to population and is more a reflection of growing infrastructure as population increases,” he said. “That kind of data can be hard to find published.”