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Minnesota’s Knowledge-Based Service Economy

10/26/2016 8:30:00 AM

Various forces are driving job growth in some Minnesota occupations and decline in others.

Leading forces behind declining employment in occupations that once offered solid careers include:

  • Shifts in consumer tastes
  • Evolving technology
  • Innovations in business and management practices
  • Changes in government funding
  • Globalization
  • Changes in laws

These same forces are creating rapid growth in other occupations unheard of just a decade ago.

 Here’s a snapshot:

  • Production jobs – such as print binding and finishing workers or paper goods machine setters – are declining.
  • Health-care related occupations – like registered nurses or medical assistants – have been and will continue to expand.
  • Paralegals and legal assistant jobs increased over the last decade even though employment in the legal industry declined. Legal firms hired paralegals to perform tasks previously carried out by lawyers.
  • Surveyor and surveying technician positions are occupations that are being negatively affected by advances in surveying technology. Robotic total stations have reduced demand for surveyors even as the amount of surveying work expands.
  • Minnesotans increasingly prefer to dine out rather than cook at home, resulting in a jump in cooks and bartenders over the last 10 years. This trend is expected to continue.
  • Construction jobs have been gradually recovering since 2010 and are expected to continue to increase as part of the cyclical recovery from the industry’s boom-and-bust building cycle.
  • Manufacturing employment in Minnesota has been bouncing back since the Great Recession, but the rebound is short-term, as the long-term trend is shrinking factory employment. In Minnesota, manufacturing employment is down 20 percent (a decline of 79,000 jobs) from the 1998 peak.
  • Other occupations – such as computer-related jobs – benefit as software advances. Greater emphasis on cloud computing, collection and storage of big data, and demand for mobile computing ensures the long-term growth of computer-related jobs, even as some of these are outsourced to low-wage countries.
  • Retail trade saw declining employment, resulting in declining jobs in sales and related occupations. The drop in office and administrative support occupations – such as data entry keyers, order clerks and stock clerks – arose from technology that reduced demand for workers.
  • Production and office administrative support occupations are expected to continue to decline as automation improves productivity.

The forces that drove employment growth in service-providing industries from 2004-2014 will continue to generate most job growth from 2014-2024. The result, just like over the last decade, will be lots of job growth in health care occupations. Most of the other job growth will also occur in service-related industries and occupations as Minnesota continues to evolve into a knowledge-based service economy.

See the September issue of Trends, our quarterly magazine offering expert analysis of the state's labor market, industries and economy, for more on Minnesota’s knowledge-based service economy.

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