30 7 TH STREET, S UITE 350 MEMORANDUM

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1 OFFICE OF THE CHANCELLOR WELLS FARGO PLACE ph TH STREET, S UITE 350 fx ST. PAUL, MN DATE: September 15, 2011 MEMORANDUM TO: FROM: Presidents, Chief Academic Officers - Colleges with Electrician Programs: Anoka Technical College Dakota County Technical College Hibbing Community College Lake Superior College Minneapolis Community and Technical College Minnesota State Community and Technical College Minnesota West Community and Technical College Northland Community and Technical College Northwest Technical College Bemidji Ridgewater College Riverland Community College Saint Paul College St. Cloud Community and Technical College Larry Litecky, Interim Vice Chancellor for Academic and Student Affairs SUBJECT: Labor Market Analysis for Electrician Programs Thank you for continuing to limit enrollment in our system s electrician programs. As you recall, placing enrollment caps on these programs has been a sensitive issue of importance to students, Board of Trustees, faculty members, campus administrators and the IBEW union. Working with DEED, we have completed another supply and demand study for electrician programs. Given recent conditions summarized below and detailed in the attached report 1, I am requesting that fall 2006 enrollment caps remain in effect for all electrician programs and that no new electrician programs be approved at this time. 1 The report is also available at the Academic Programs website: The Minnesota State Colleges and Universities System is an Equal Opportunity employer and educator.

2 Enrollment Caps Memorandum September 14, 2011 Page Two As a change, however, enrollment caps will remain in effect for each region rather than each college. This shift is consistent with our new focus on increased inter-institutional planning and intention to provide some flexibility for programs in a region. The attached report is the fourth update to a labor market analysis for electrician programs that was first published in the spring of At that time an enrollment cap was placed on electrician programs and a moratorium was placed on the creation of new electrician programs. The following table shows that all programs, except two, are in compliance with the enrollment cap. By region, enrollment in electrician programs in fall 2010 is less than the enrollment cap level in fall Electrician Program Enrollment Change Fall '06 to '10 College Fall '06 Enrollment Fall '07 Fall '08 Fall '09 Fall '10 Headcount Percent Cap Anoka % Dakota County % Hibbing % Lake Superior % Minneapolis % Minnesota State % Minnesota West % Northland % Northwest % Ridgewater % Riverland % Saint Cloud % Saint Paul % Total 1,191 1, % Electrician Program Enrollment Change Fall '06 to '10 Region Fall '06 Enrollment Fall '07 Fall '08 Fall '09 Fall '10 Headcount Percent Cap Northwest % Northeast % Central % Twin Cities % Southwest % Southeast % Total 1,191 1, %

3 Enrollment Caps Memorandum September 14, 2011 Page Three The report, using the most recent job projections, job vacancy survey, unemployment insurance, and 2010 program graduates data, the 2010 regional analysis of supply and demand conditions for electricians, shows that statewide supply exceeds demand by 660 or 2.7 individuals per opening. By region, this oversupply-per-opening condition ranges from 1.9 to 6.3. Thank you for taking the time to review the report and maintain enrollment caps. Our plans are to reassess conditions later this fall when we will again consider the need to maintain or lift enrollment caps by region. c: Scott Thiss, Board of Trustees, Chair Steven Rosenstone, Chancellor Leslie Mercer, Senior Associate Vice Chancellor Bernie Omann Ron Dreyer

4 Supply and Demand Conditions for Electricians An Update of Labor Market and Electrician Program Data July 2011 Prepared by: Rachel Vilsack Regional Labor Market Analyst MN Department of Employment & Economic Development (DEED) (651) In collaboration with: Office of the Chancellor Minnesota State Colleges and Universities

5 Purpose The purpose of this report is to provide a current regional analysis of the labor market for electricians in the state of Minnesota. Background A memo was sent to Presidents and Chief Academic Officers at the 13 Minnesota State Colleges and Universities institutions with electrician programs on March 15, 2007 that prohibited the addition of new electrician programs and directed that fiscal year 2008 enrollment be limited to the fiscal year 2007 level. This decision was based primarily on an analysis of statewide labor market data on electricians, including trends in electrical contractor industry employment, Unemployment Insurance claims, long-term occupational employment projections, job vacancies, and the number of electrician program completers from all Minnesota postsecondary institutions. Subsequently in April 2007 regional estimates of the supply/demand conditions for electricians were produced. The March 15 th, 2007 memo indicated that the decision to cap electrician enrollment would be re-reassessed in October of subsequent years using both internal and external inputs. This is the fourth such report that has been prepared and references labor market activity through the first half of Following a summary of findings, this report presents regional information on demand, supply, wages, and net supply-demand. 1

6 EXECUTIVE SUMMARY Overall, statewide indicators show that the recovery from the recession continues to impact the already-struggling electrician labor market in the past year. There remains a surplus of electricians in Minnesota; however that surplus is less than it was estimated one year ago. DEMAND Employment in the construction industry, where most electricians are employed, is down by 6,900 jobs or 8.1 percent from a year ago (p. 3), and short-term industry employment is projected to remain steady into the first half of 2012 (p. 8). Over the next 10 years, the number of employed electricians is projected to increase by six percent. Practically all projected electrician openings result from replacement openings (p. 9). SUPPLY There were 983 electricians receiving regular Unemployment Insurance benefits in May 2011 a decline of 42.5 percent from a year ago, or 727 fewer individuals (p. 10). The number of graduates from Minnesota electrician programs (415) in 2010 was down by five graduates from the previous academic year (p. 12). Minnesota electrician program enrollment in the fall of 2010 is 874, a decrease of 143 or about 14 percent from last year s level (p. 14). Wage trends for electricians show small upward pressure. Inflation-adjusted wages for electricians grew slightly in 2009 and 2010 after five consecutive years of decline (p. 16). Graduate Follow-up Survey data showed declines in related-employment rates in The related employment rates for graduates in the southeast region fell precipitously to 52.4 percent, while the rate for graduates in the Twin Cities region declined to 41.6 percent (p. 19). SUPPLY-DEMAND COMPARISON In 2010, Minnesota has a surplus of 660 electricians based on the supply-demand comparison using the most recent job projections, job vacancy survey, unemployment insurance, and 2010 program graduate data collected via a survey of colleges (p. 21). ENROLLMENT CAPS Based on an analysis of regional supply and demand conditions for electricians, enrollment caps were issued for colleges that have electrician programs. These caps have remained in effect for all colleges, except for Minnesota West Community and Technical College, whose enrollment cap was lifted in a June 4, 2009 memo and reinstated in a November 4, 2009 memo (p. 22). 2

7 DEMAND Industry Employment Trends In Minnesota, approximately 80 percent of all electricians are employed in the construction industry. 1 Based on national staffing patterns within the construction industry itself, 93 percent of electricians are employed by electrical contractor firms. 2 Chart 1 below shows the seasonally-adjusted employment trend in statewide construction industry employment. The total number of construction industry jobs in Minnesota grew until about February The total number of construction jobs in June 2011 was 78,800. This is down 53,200 or 40.3 percent from the high reached in February 2006, and down by a seasonally adjusted 6,900 jobs or 8.1 percent from a year ago. 3 1 Minnesota Department of Employment and Economic Development (DEED), Labor Market Information Office, Occupational Employment Statistics (OES), 2 Bureau of Labor Statistics (BLS), OES, 3 DEED, Labor Market Information Office, Current Employment Statistics (CES), 3

8 A more detailed breakdown of construction industry employment trends is not available on a seasonally-adjusted basis. Instead, Table 1 shows the comparison of employment to the same month a year ago. It should be noted that electrical contractors are found in the building equipment contractors industry. Over the past year, the construction sector has suffered the largest relative job loss of any sector in the Minnesota economy. As Table 1 shows, the heavy and civil engineering sector has suffered the greatest loss of jobs as a percentage of total jobs. Employment in residential building has declined by nearly 12 percent. Closely related to the drop in residential building is the drop in building equipment contractors, the specialty trade subcontractors that complete various phases of the building project. Through the first quarter of 2011, the number of housing units authorized by building permits in Minnesota is nearly 40 percent below the number authorized in the first three months of 2010; and 35 percent below the number of permits in the first three months of Table 1: Downturn Still Affecting Construction Industry Employment in Minnesota (DATA ARE NOT SEASONALLY ADJUSTED) Change from Year Ago Industry June 2011 June 2010 Number Percent Construction 87,112 95,303-8, % Construction of Buildings 20,622 21, % Residential Building 8,457 9,603-1, % Heavy & Civil Engineering Construction 12,960 15,232-2, % Specialty Trade Contractors 53,530 58,729-5, % Foundation, Structure & Building Exterior 11,897 11, % Building Equipment Contractors 23,474 26,219-2, % Source: DEED, Labor Market Information, Current Employment Statistics 4 U.S. Census Bureau, Housing Units Authorized by Building Permits, 4

9 The Quarterly Census of Employment and Wages is based on employer-submitted reports on payroll employment and wages for the Minnesota Unemployment Insurance Tax. It shows the most detailed breakdown of industry employment by industry category and geographic region. However, there is a six-month lag in time from the end of the quarter for which employment is reported and when it becomes available. Chart 2 shows that while total specialty trades construction industry employment grew from 2001 through mid-2006; total electrical contractor employment has been declining gradually since The demand for non-residential electrical contracting work weakened after 2001, leveled off from 2004 to 2007, but started to drop again in The slowdown in residential construction has had a pronounced impact on residential electrical contracting employment since Employment in most sectors began to level off in

10 Chart 3 shows that the Twin Cities region had 56 percent of the total electrical contractor industry jobs in Minnesota in Over 80 percent of the state s job loss in the electrical contractor industry since 2000 has occurred in the Twin Cities region, 4,626 jobs or a decline of 34.1 percent. Most regions in Greater Minnesota have experienced smaller changes over the time period, ranging from a 16.5 percent decrease in the Northeast region to a 30.2 percent decrease in the Southeast region. Numerically, the job loss ranges from 123 jobs lost in the Northeast region to 435 jobs lost in the Southeast region. Between 2009 and 2010, there were job declines in the electrical contractor industry in all regions of Minnesota. 5 5 DEED, Labor Market Information, Quarterly Census of Employment and Wages (QCEW), 6

11 Job Vacancies Twice each year the Department of Employment and Economic Development s Labor Market Information Office (DEED-LMI) conducts a survey of job openings in Minnesota. Chart 4 shows that the statewide number of vacancies for electricians during the second quarter of 2010 and fourth quarter of 2010 increased significantly from the same quarters one year previous The job vacancy rate for electricians in the fourth quarter of 2010 was estimated to be 0.8 percent, or 0.8 job openings for every 100 electrician positions in the state. This is less than both the overall job vacancy rate for the major construction and extraction occupational group (0.9%), and the overall job vacancy rate (1.4%). 6 6 DEED, Labor Market Information, Job Vacancy Survey (JVS), 7

12 Short-term Projections Short-term industry and occupation employment projections are produced quarterly by DEED- LMI. The most recent figures available are shown in Table 2 below. The number of employed electricians is projected to decline by 80, a 1.0 percent decrease over the next year due to the continued slow recovery from the severe recession and the lack of demand for new residential construction given the large supply of housing in the market. All electrician openings result from projected replacement openings. 7 Table 2: Replacement Demand Accounts for All Short-Term Projected Electrician Job Openings 1Q 2011 to 1Q 2012 Projections Occupation Estimated Employment, 1Q 2011 Projected Employment, 1Q 2012 Percent Change Numeric Change Replacement Openings* Total Openings** Total, All Occupations 2,593,442 2,627, % 33,938 58,812 94,240 Construction and Extraction 66,315 66, % 57 1,128 1,448 Electricians 7,762 7, % *Replacement Openings: Net replacement openings are an estimate of the need for new work force entrants to replace workers who leave an occupation. It estimates the net movement of the following: 1) experienced workers who leave an occupation and start working in another occupation, stop working altogether, or leave the geographic area, minus 2) experienced workers who move into such an opening. It thus does not represent the total number of jobs to be filled due to the need to replace workers. ** Total Openings: Total job openings represent the sum of employment increases and net replacements. If employment change is negative, job openings due to growth are zero and total job openings equals net replacements. Source: DEED, Labor Market Information, Employment Projections 7 DEED, Labor Market Information Office, Employment Projections, 8

13 Long-term Projections Table 3 shows the electrician employment and job openings projections for Minnesota and the six planning regions for from DEED-LMI long-term projections. According to Table 3, there is a projected average annual demand of 310 electrician job openings each year from 2009 to 2019 in Minnesota. Job openings in the seven-county Twin Cities region are projected to account for 55 percent of the total openings for electricians in Minnesota. Net replacement demand, including retirements, is also a big part of the long-term projections figures. About 80 of every 100 projected openings are due to replacement demand. Table 3: Practically All Projected Electrician Openings Due to Replacement Demand, not Growth Estimated Projected Avg. Ann Employment, Employment, Percent Numeric Replacement Total Total Area/Region Change Change Openings* Openings* Openings Minnesota 10,308 10, % 613 2,490 3, Northwest % Northeast % Central 1,136 1, % Twin Cities 5,368 5, % 416 1,300 1, Southwest % Southeast 1,032 1, % * Please refer to the definitions found with Table 2. Source: DEED, Labor Market Information, Employment Projections 9

14 SUPPLY Trends in Unemployment Monthly data on electricians who have been receiving Unemployment Insurance (UI) benefits provide the best available information on the number of unemployed electricians, both union and non-union members. However, it will not capture all of the unemployed due to eligibility requirements and the fact that some individuals may have exhausted benefits. The chart below shows the comparable trend for only those individuals receiving regular UI benefits over the past six years. It does not include an additional number of unemployed workers who received Federal Emergency Unemployment Compensation (EUC) benefits. The EUC benefits were first paid in July 2008 and have been extended several times since then. The impact of the recession on top of the earlier slowdown in residential construction is dramatically reflected in the increase in unemployment insurance claims beginning in the fourth quarter of 2007 and accelerating in As shown in Chart 5, the actual number of people receiving Unemployment Insurance in May 2011 was 983, down by 727 or 42.5 percent from a year ago. The twelve-month moving average in May 2011 was 1,100, down by 953 or 46.4 percent from a year ago. 8 Recent numbers of UI recipients have declined to pre-recessionary levels. It should be noted that the number of electricians who ve exhausted their UI benefits has increased, reaching 1,732 individuals just in calendar year DEED, Labor Market Information, Unemployment Insurance 10

15 Chart 6 shows the 12-month moving average of electrician Unemployment Insurance (UI) recipients by the six sub-state planning regions. The increase in claims during the recession was been felt by all regions of the State. Declines in the 12-month moving average of electrician UI recipients began to decline in mid In May 2011, the 12-month average number of electrician Unemployment Insurance recipients was 1,100, down by 953 or 46.4 percent from a year ago, with the Twin Cities region registering a decline of 494 claims or 52.3 percent. While having smaller numerical declines, unemployment has declined most rapidly in the northeast region (down 72 claims or 47.6 percent) and in the central region (down 209 claims or 44.8 percent). 11

16 Program Graduates The number of students completing electrician programs in Minnesota in 2010 was exactly five fewer than in 2009, a decline of 1.2 percent. There were small regional variations in the number of electrician program graduates in Greater Minnesota. The sharpest relative drop occurred in the northeast and central regions. The Lake Superior program in the northeast region registered nine fewer graduates and ten fewer students graduated from St. Cloud, in the central region. The southeast region registered 14 more graduates in 2010 than in Table 4: The Overall Number of Electrician Program Graduates Declined Slightly in 2010 Graduates Change FY09 - FY10 Institution FY09 FY10 Numerical Percentage Anoka % Dakota County % Dunwoody % Hibbing % Lake Superior % Minneapolis % Minnesota State % Minnesota West % Northland % Northwest % Ridgewater % Riverland % Saint Cloud % Saint Paul % TOTAL % Graduates Change FY09 - FY10 REGION FY09 FY10 Numerical Percentage Northwest % Northeast % Central % Twin Cities % Southwest % Southeast % TOTAL % 2010 figures based on a survey of college programs. 12

17 Apprenticeship Completers Another source of the supply of electricians is formal apprenticeship programs. As table 5 shows, the number of electrician apprenticeship completions in fiscal year 2010 decreased by 42, or about 25 percent, from the previous year. The number of apprentices was about the same as the level in 2007, at the start of the economic recession. However, it was 182 or 60 percent below the peak number in Table 5: Number of Apprenticeships Down in 2010 Apprenticeship Occupation Fiscal Year Construction Electrician Maintenance Electrician TOTAL Source: Minnesota Department of Labor and Industry 13

18 Program Enrollment As shown in table 6, the number of new first-year electrician program students was down by 106 or 19.3 percent in the fall of 2010 compared to the previous year. The number of returning second year students declined by 7.9 percent from a year ago, or 37 fewer students. This suggests that the total number of graduates will decrease in FY2011. Table 6: Total Enrollment in State College Electrician Programs Declined by 14 Percent from Previous School Year New 1st Yr Students Returning 2nd Yr Students Total Enrollment INSTITUTION Fall '09 Fall '10 Fall '09 Fall '10 Fall '09 Fall '10 Anoka Dakota County Dunwoody Hibbing Lake Superior Minneapolis Minnesota State Minnesota West Northland Northwest Ridgewater Riverland Saint Cloud Saint Paul TOTAL , Numerical Change Fall '09 to Fall ' Percent Change Fall '09 to Fall ' % -7.9% -14.1% New 1st Yr Students Returning 2nd Yr Students Total Enrollment REGION Fall '09 Fall '10 Fall '09 Fall '10 Fall '09 Fall '10 Northwest Northeast Central Twin Cities Southwest Southeast TOTAL , New students: those students, who at the beginning of the semester identified in the chart, were either in the first or second semester of their program. Returning students were either in their third or fourth semester. Source: Survey of Chief Academic Officers conducted by the Office of the Chancellor in June

19 Chart 7 displays the trend in electrician program enrollment at the 13 institutions in the Minnesota State Colleges and Universities system over the past five fall survey periods. The number of graduates in 2011 is very likely going to be in the range of 20 fewer than in 2010 due to the more moderate drop in the number of second-year students. 15

20 WAGES Another way to determine if there is a shortage or surplus of workers is to track the rate and direction of the change in wages. If there is a shortage, the wage level should increase at a faster than average rate to attract workers to move to the area or to persuade them to enter the field. If there is not a shortage, wage levels will increase at a slower than average rate or even decline. Chart 8 shows both inflation-adjusted (real) wages and non-inflation-adjusted wages (actual). The 2010 median wage level for electricians in Minnesota is $29.58, considerably higher than the median wage for all occupations, $ Median wages for electricians increased slightly over the past two years. Chart 8 shows a lack of upward pressure on wages for electricians until 2008, which is indicative of a surplus situation. Inflation-adjusted wages for electricians declined in five consecutive years between 2003 and By way of comparison, overall wages have grown at nearly the same rate as inflation as measured by the Consumer Price Index for All Urban Consumers (CPI-U) until The faster rate of inflation last year (3.9%) eroded the modest overall wage gain, resulting in a decline in real wages. 16

21 Chart 9 shows the impact of leveling demand for electricians on the year-to-year change in median wage level. In the early part of 2000, construction activity was booming and electrician s wages were increasing annually by four to six percent. As demand weakened in non-residential building, electrician wage growth downshifted abruptly to only 0.4 percent and 1.7 between 2003 and As the slowdown in demand has continued with cutbacks in new residential construction, the median wage for electricians has declined over-the-year by -0.8 percent and -3.9 percent in 2006 and Median wages increased in 2009 and 2010 and may reflect the leveling off of demand. 17

22 Chart 10 below compares actual average weekly wages paid to all workers in the electrical contractor industry statewide and in six planning regions. In 2010 there was a mixed trend with two regions experiencing an increase in actual wages and the other regions experiences small changes, by one or two dollars. The Twin Cities 2010 industry wage data showed decline for the second consecutive year. Actual wages in the northeast region have shown the greatest gain in actual wages over the 2007 to 2010 period, increasing by almost 16 percent, followed by the northwest with a nearly seven percent growth in actual wages. 18

23 Related Employment Rate Data collected from the Minnesota State Colleges and Universities Graduate Follow-up Survey provides another indicator of the supply and demand conditions for electricians. Table 8 on the following page generally reaffirms other data presented throughout this report that labor market indicators for electricians have weakened in the past year. The statewide related employment rate was the lowest in the past six years, 61.0 percent. The data also vividly show the greater weakness in the Twin Cities region job market than in Greater Minnesota, as the rate for Twin Cities graduates, 41.6 percent, was 23 percentage points lower than the rate for graduates from programs in Greater Minnesota, 65.3 percent. The overall related employment rate declined at all four Twin Cities programs. The related employment rate for the two suburban programs at Anoka Technical College and Dakota County Technical College were noticeably lower, averaging 38.1 percent, while the programs in Minneapolis and St. Paul averaged 44.2 percent. While the Greater Minnesota program graduates generally fared better than those in the Twin Cities, the 2009 graduates of electrician programs in northeast and southeast Minnesota had a somewhat harder time finding related employment compared to previous years. The related employment rate for 2009 graduates from Lake Superior College was 33.7 percent, a decrease of 19.2 percentage points from the 2008 graduates related employment rate. Hibbing s electrician program graduates fared somewhat better in finding work in the year after graduation as the related employment rate increased from 25.0 percent in 2008 to 36.8 percent in The related employment rate for 2009 graduates of the three programs in the northwest region (Minnesota State, Northland and Northwest) was 79.8 percent. This is very good, but still below the previous year s rate of 88.0 percent. The 2009 graduates of electrician programs located at colleges in southern Minnesota generally also had a worse related employment rate than the previous year s graduates. The related employment rate for 2009 graduates from Minnesota West Community & Technical was 74.3 percent, a decline of 19.0 percentage points from the 2008 graduates related employment rate. The related employment rate for 2009 graduates from Riverland Community College fell to 52.4 percent, a decline of 39.4 percentage points from the 2008 graduates related employment rate. 19

24 Table 8: 2009 Related Employment Rate Confirms Weak Hiring in Twin Cities and Mixed Conditions in Greater Minnesota Awards Related Employment Rate Institution Anoka % 94.2% 87.5% 68.6% 80.0% 33.3% Dakota County % 81.8% 60.0% 88.9% 51.0% Hibbing % 76.8% 69.2% 66.7% 25.0% 36.8% Lake Superior % 100.0% 94.4% 80.0% 52.9% 33.7% Minneapolis % 100.0% 80.0% 85.6% 70.0% 42.9% Minnesota State % 92.6% 93.2% 96.6% 92.1% 83.9% Minnesota West % 97.1% 100.0% 90.0% 93.3% 74.3% Northland % 100.0% 92.3% 100.0% 95.0% 55.6% Northwest % 50.0% 88.9% 100.0% 76.9% 100.0% Ridgewater % 90.0% 100.0% 100.0% 92.3% 100.0% Riverland % 87.5% 90.9% 72.5% 88.9% 52.4% Saint Paul % 80.0% 73.7% 44.8% 47.7% 45.5% St. Cloud % 91.9% 96.2% 97.6% 86.0% 79.3% Total % 90.9% 90.1% 81.8% 76.9% 61.0% Awards Related Employment Rate Planning Region Northwest % 91.8% 92.6% 97.6% 90.8% 79.0% Northeast % 87.5% 79.5% 70.6% 36.6% 35.2% Central % 91.3% 97.1% 98.4% 87.5% 85.7% Twin Cities % 90.1% 82.5% 62.0% 64.5% 41.6% Southwest % 97.1% 100.0% 90.0% 93.3% 74.3% Southeast % 87.5% 90.9% 72.5% 88.9% 52.4% Total % 90.9% 90.1% 81.8% 76.9% 61.0% Data for Electrician Program CIP Source: MnSCU, Graduate Follow-Up Survey 20

25 SUPPLY-DEMAND COMPARISON The initial study of supply/demand conditions for electricians done in the spring of 2007 showed an estimated surplus of 575 electricians. The report released in October 2007 estimated the surplus at 428, and a surplus of over 1,400 electricians in Table 7 below shows a surplus of 660 electricians in the state based on the supply-demand comparison using the most recent job opening projections, job vacancy survey, unemployment insurance, and 2010 program graduate data collected via a survey of colleges. No regions of the state are experiencing a shortage of electricians this spring. The degree of surplus varies depending on the region of the state. The central region has the second largest estimated surplus, as well as the highest ratio of supply to demand. The southwest region s estimate shows a surplus of 30. The ratio of supply to demand in the southwest region increased in the past year. It has gone from 2.3 in 2009 to 4.8 this year. The surplus in the Northeast region declined from 91 in 2009 to 53 in The surplus in the Twin Cities region has declined the most of any region, going from 646 last year to 190 this year. Table 7: The Estimated Surplus of Electricians Declined in 2010 Demand Average Region Total Region's Openings 2010 Graduates Estimated Due to Electrical Adjusted Employment Growth and Program for Replacement Graduates Migration* plus Vacancies Supply Adjusted Unemployed** Total Supply*** Difference Between Total Supply and Estimated Annual Demand Total Supply per Opening Minnesota 10, , Northwest Northeast Central 1, Twin Cities 5, Southwest Southeast 1, * 2010 electrician program graduates adjusted by FY1998-FY2004 regional average percentages working in Minnesota and relocating to other regions within the state. Some graduates work outside of Minnesota. ** The number of unemployed electricians in excess of a 4% unemployment rate for electricians in each region. This is calculated by multiplying the estimated regional electrician employment by.04 and subtracting that number from the 12-month moving average number of electricians receiving Unemployment Insurance. *** 2010 electrician program graduates plus adjusted unemployed. 21

26 SUMMARY This paper has reviewed available labor market indicators of supply and demand for electricians in Minnesota and its sub-state regions as of the second quarter of The difficult conditions for electricians remained in the past year as the Minnesota economy continues to recover from the worst recession in the past 70 years. While the surplus is less than half of what it was one year ago, the supply of electricians continues to be higher than demand. Employment rates for electrician graduates from MnSCU institutions also fell in 2009, indicating that there are still a fair amount of recent graduates who have not found work. Short-term employment projections for electricians are projected to decline by 1 percent into the first half of On the supply side, unemployment insurance claims have started to fall, which may be a sign of slightly improving conditions. However, the number of electricians who ve exhausted their benefits peaked at over 1,730 in calendar year The number of students enrolled in electrician programs is contracting in response to demand and the number of graduates is likely to decline next spring. The greatest imbalance in supply and demand is in the central region. Meanwhile the southwest, southeast, and northwest regions seem to be faring somewhat better due to connections to companies in border states and/or in non-construction industries where there is a demand for electricians, such as wind energy. Wage trends also confirm that there is no shortage of electricians. While the median wage for electricians is still considerably higher than the median wage for all occupations, wage growth has not kept pace with inflation. A March 15, 2007 memo, sent to 13 Presidents and Chief Academic Officers of colleges that have electrician programs, prohibited the addition of new electrician programs and limited enrollment for existing programs based on an analysis of regional supply and demand conditions for electricians. These caps have remained in effect for all colleges, except for Minnesota West Community and Technical College, whose enrollment cap was lifted in a June 4, 2009 memo and reinstated in a November 4, 2009 memo. 22