Central Minnesota is well known for manufacturing and food processing, but there are other industries that also make the region unique. The easiest and most common way to illustrate distinguishing industries is by calculating a location quotient (LQ). An LQ of 1 means there is the same employment concentration in the region as there is statewide. Anything over 1 indicates that there is over-representation, while an LQ of less than 1 means there is a lower concentration in the region than found statewide.

According to data from DEED’s Quarterly Census of Employment & Wages program, Central Minnesota’s share of employment in furniture and related product manufacturing is 2.9 times higher than what’s found statewide. This high concentration of employment in furniture and related product manufacturing – which includes kitchen cabinets – makes it a “distinguishing industry”.

Furniture and related product manufacturers in Central Minnesota reported just over 2,700 jobs in 2016, which was down from 3,480 jobs in 2000. Despite losing jobs, it has a higher location quotient now than it did then. The related nonmetallic mineral product manufacturing industry – which produces granite countertops – saw its regional share shrink over time, but is also still a distinguishing industry.

In the last decade and a half, there have been some changes to Central Minnesota’s distinguishing industries. Back in 2000, nonstore retailers – such as the now-closed Fingerhut – had the highest employment concentration in the region with an LQ of 3.08. Since then, its LQ has dropped below 1.0. Most of the distinguishing industries have held steady, though, while other industries – such as transportation equipment manufacturing and beverage manufacturing – have become more strongly concentrated in the region.

Central Minnesota benefits from having high LQs in high-paying industries. In 2016 the average annual wage across all industries in the region was $40,924, meaning 7 of the 10 distinguishing industries have higher than average annual wages. That’s good news for workers and communities across the region.

Although a dynamic and broad economic base is important to withstand changes in business cycles and consumer preferences, the high density of jobs in these distinguishing industries has positive impacts. For instance, workers have greater mobility to change employers or occupations within their respective field, and employers benefit from having a skilled labor pool in a single area. Economies of scale can also promote investment in training initiatives, or even pooling resources among similar companies to provide training solutions.

For More Information

Contact Luke Greiner at 320-308-5378 or email Luke.Greiner@state.mn.us.