Posted by: Josh Lehner | February 25, 2020

Young Oregonians and the Trades

Two years ago our office really dug into the trades and classic blue collar occupations. Today we’re back with an updated look based on available Oregon data. Today, as then, the primary focus and concern is trying to see if younger workers are avoiding these potential career paths. This matters for at least a couple of reasons.

First, construction (mainly nonresidential work) and installation, maintenance, and repair jobs are the gold standard for wages in fields that do not require college degrees. Now, as discussed before, these are skilled workers, but the skills are learned more on the job than in the classroom on a college campus. Furthermore, from a job polarization perspective, these manual, non-routine occupations are hard to automate and their outlooks are tied not to technological change but to population growth.

Second, the labor market is tight for both cyclical and structural reasons. If younger workers are not entering into a particular occupation, then it makes those structural, demographic challenges even more difficult given the Baby Boomers will continue to retire.

The upshot is young Oregonians are coming back into the trades as the economy improves. Overall there are more job opportunities in these fields today than a few years ago as the economy grows. Younger workers are filling these openings to a larger degree. Now, I don’t want to minimize legitimate supply side concerns, like the lack of vocational training programs or the everyone should go to college mantra, which work to limit people’s knowledge about and exposure to the trades. However the data continues to point toward the demand side being a the larger factor.

Now, a couple things stand out in the chart above.

One, even while rising recently, the share of young adults working in these occupations is down over the past couple of generations. These declines are directly tied to production (the manufacturing jobs that actually do the manufacturing) and transportation and material moving (mostly laborers with the drop). There are not corresponding drops over time for construction, or installation, maintenance, and repair occupations. This points toward big picture, structural changes in the economy being the primary culprit, and not that kids these days are soft.

The other very evident thing in the chart is the massive differences seen among men and women. These classic blue collar occupations are dominated by men. In 2018, women accounted for just 2% of all construction jobs in Oregon, 4% of installation, maintenance, and repair jobs, and 22% each for production, and transportation and material moving occupations. These percentages are nearly identical if we focus on young Oregon women or across all ages. Clearly, women remain a largely untapped pool of workers for these careers. The good news is women enrolled in apprenticeship programs is up in the state, although not evident in the Census data yet.

Finally, we know a lot of Millennials graduated into the Great Recession. Job opportunities were few and far between, especially for the trades which are more cyclical. A key question and risk is to what degree workers would come back into the trades a bit later in life in this case, or if they would forgo the professions entirely. We know wounds heal, but do scars remain?

Here we find some more encouraging news. The chart below tracks different cohorts of Millennial men in Oregon as they age into their 20s and their 30s. Older Millennials (light blue line) graduated into the housing boom. A historically large share of them entered into construction given the opportunities. However middle Millennials (dark blue line, and not really a thing, I know) graduated into the Great Recession. Very few found jobs in construction given the housing bust. However, notice how the lines converge despite the massive gap at the beginning. As the economy improved and construction industry rebounded, these Millennials born around 1990 found their way into construction jobs.

Today, about 7% of Millennial men in Oregon work in construction occupations. This goes for old Millennials and young Millennials alike.

Bottom Line: Younger workers are entering into the trades in greater numbers today than a few years ago. The Great Recession left scars, and underlying shifts in the economy does mean some of these career paths provide fewer opportunities today than for past generations. That said, the real fears that younger workers would forgo these professions entirely appear overblown. Strong economies really do work wonders, even if they don’t cure all ills.

Note: See our previous work for a more thorough discussion on these topics. I have a lot more on recent Oregon trends if you wish to discuss further. I focused primarily on construction for two reasons. First, our office has a few construction-related presentations coming up. Second, more than half the volatility of young people in the trades in recent decades is driven by construction specifically. The other blue collar occupations show less movement.


Responses

  1. Yes, many manual jobs are hard to automate, plumbing and electrical being two good examples. However, the traditional “stick and board” method of home construction lends itself to streamlining where portions of a structure may be built offsite and then assembled onsite. Whether it will make inroads into custom home building can be debated, but in development models, where the same structure with variations is often built, pre-built components offers a real opportunity to reduce construction costs and time through more efficient building methods.

  2. […] Source: Young Oregonians and the Trades | Oregon Office of Economic Analysis […]


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