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 Response Page - Kalambokidis  Interview -      
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These comments are responses to the statements listed below,
which were generated in regard to the 
Laura Kalambokidis  Interview of
01-09-2015.

Tightening labor market means state cannot afford to leave any workers on the sidelines

OVERVIEW

The aging of the population is resulting in a slowing of labor force growth in the U.S. and in Minnesota, according to Minnesota State Economist Laura Kalambokidis. This slower growth is one of the reasons that, while forecasters still expect growth in U.S. GDP over the next year, the rate of that growth will be slower going forward than forecast earlier.

Kalambokidis reports that the average annual growth in Minnesota's labor force was 0.9 percent from 2000 to 2010, but that figure is predicted to fall until it reaches an average annual growth rate of 0.1 percent between 2020 and 2025. With that slower labor force growth, she says, improving productivity (output per person) will be key to keeping Minnesota's economy healthy.

Kalambokidis says Minnesota's low unemployment rate, low layoff rate, high job vacancy rate, and the high and increasing average number of hours worked per week in the private sector all point to a tightening of the labor market in Minnesota and more competition for the workers we have. But, she notes, the wage growth these conditions were expected to bring did not occur in 2014 and will be lower going forward than forecast earlier.

She confirms that with its tightening labor market, Minnesota will be in competition with all other states for workers, since other states, too, face the same challenges. She's optimistic about Minnesota's economy, but cautions that going forward, the state is looking at a labor market where we need everybody in the game and no groups of people on the sidelines.

For the complete interview summary see: Kalambokidis nterview

Response Summary: Average response ratings shown below are simply the mean of all readers’ zero-to-ten responses to the ideas proposed and should not be considered an accurate reflection of a scientifically structured poll.

To assist the Civic Caucus in planning upcoming interviews, readers rated these statements about the topic on a scale of 0 (strongly disagree) to 5 (neutral) to 10 (strongly agree):  

1. Topic is of value. (8.7 average response) The interview summarized today provides valuable information or insight.

2. Further study warranted. (7.8 average response) It would be helpful to schedule additional interviews on this topic.

Readers rated the following points discussed during the meeting on a scale of 0 (strongly disagree) to 5 (neutral) to 10 (strongly agree): 

3. Higher worker productivity needed. (8.2 average response) Slower growth of the state's labor force means that Minnesota's economic growth will be increasingly dependent upon gaining more productivity per worker.

4. Lifelong training to be essential. (8.4 average response) Increasing productivity requires educating, training, and retraining the workforce from early years into adult years.

5. Immigration has offset out-migration. (7.9 average response) The state's labor force has grown only because the gain from international migration has more than offset a net loss in domestic migration.

6. Competition for talent to intensify. (8.5 average response) Interstate competition for talent will only intensify in coming years, because other states also are experiencing slower growth in their homegrown workforces.

7. Wages continue to lag. (7.2 average response) Despite low unemployment, low layoffs, high job vacancy, and higher hours worked per week, which all point to a tightening of the labor force in Minnesota, wage growth did not occur in 2014 and is likely to continue to be sluggish.

Response Distribution:

Strongly disagree

Moderately disagree

Neutral

Moderately agree

Strongly agree

Total Responses

1. Usefulness of topic.

0%

0%

11%

44%

44%

9

2. Importance of further discussion.

0%

0%

11%

67%

22%

9

3. Higher worker productivity needed.

0%

0%

22%

44%

33%

9

4. Lifelong training to be essential.

0%

0%

11%

56%

33%

9

5. Immigration has offset out-migration.

0%

0%

11%

67%

22%

9

6. Competition for talent to intensify.

0%

0%

0%

78%

22%

9

7. Wages continue to lag.

0%

0%

11%

78%

11%

9

Individual Responses:

Don Anderson (5) (5) (7.5) (10) (7.5) (10) (7.5)

Scott Halstead (10) (7.5) (10) (10) (10) (10) (10)

3. Higher worker productivity needed. Businesses may need to improve their compensation to attract and retain qualified, skilled workers.

5. Immigration has offset out-migration. Do the international migration workers have the qualifications to replace those lost to domestic migration? Why are individuals migrating domestically? Do we have a workplace problem? Do they wish to live elsewhere? Are they trying to relocate to a place they wish to retire?

7. Wages continue to lag. Executives are all about increasing their compensation, keeping employee compensation including benefits as low as possible. This has tremendous detrimental impact [on] workers, local, state and federal budgets or support services and taxes. It also harms the economy by reducing purchasing power.

Vici Oshiro (10) (7.5) (10) (10) (10) (7.5) (7.5)

4. Lifelong training to be essential. By coincidence I just read report on MinnPost that MN ranks 51st in the gap between whites and blacks. Some of this may be because of large and recent African immigrant population, but we've got to do better. Many of those immigrants may be well educated, but immigrants usually end up with low paying jobs.

7. General comment: We need to adapt to slower growth. A combination of climate change and continuing globalization means Americans need to focus less on consumerism and more on community.

Paul Hauge (9) (8) (9) (9) (7) (9) (7)

Dave Durenberger (10) (10) (10) (7) (5) (7) (7)

Tom Spitznagle (10) (10) (5) (5) (8) (8) (5)

My experience is that most goods and services eventually become commodities due to improvements in productivity via things like improved procedures or automation. This is where most productivity improvements seem to occur.

So I wonder if achieving gains in worker productivity through more worker education is the correct focus. It would seem that the best MN GDP gain would be achieved by training workers for jobs in evolving fields (new technologies) in which those goods/services have not yet reached the commodity level and in which true additional economic gains (i.e. - greater MN GDP and personal wealth) for the state can be realized.

Also, it will take some real economic creativity to overcome 1) the multiple adverse demographic impacts of the baby boomers and 2) the rapidly growing population of undereducated young people, especially in Minneapolis and Saint Paul.

Chuck Lutz (8) (7) (9) (8) (9) (8) (7)

Lyall Schwarzkopf (7) (6) (8) (9) (8) (8) (6)

Bert Lemunyon (9) (9) (5) (8) (7) (9) (8)

I think to get a better handle on the labor market we need to segment skilled jobs from unskilled jobs. Does the fact that the average workweek is 34 hours apply to all segments of the workforce?

    

The Civic Caucus   is a non-partisan, tax-exempt educational organization.   The Interview Group  includes persons of varying political persuasions,
reflecting years of leadership in politics and business. Click here  to see a short personal background of each.

  John S. Adams, David Broden, Audrey Clay, Janis Clay, Pat Davies, Bill Frenzel, Paul Gilje (executive director), Dwight Johnson, Randy Johnson, Sallie Kemper, Ted Kolderie,
 Dan Loritz (chair), Tim McDonald, Bruce Mooty, John Mooty, Jim Olson, Paul Ostrow, Wayne Popham, Dana Schroeder, Clarence Shallbetter, and Fred Zimmerman


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The Civic Caucus, 01-01-2008
2104 Girard Avenue South, Minneapolis, MN 55405.  civiccaucus@comcast.net
Dan Loritz, chair, 612-791-1919   ~   Paul A. Gilje, coordinator, 952-890-5220.

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