Transportation & Logistics Industry Cluster Profile I Fond du Lac County, WI
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1 & Logistics Summary The and Logistics industry cluster encompasses 105 establishments and employs 1,711 people in direct cluster jobs in Fond du Lac County. The average annual wage for direct cluster jobs is $65,676 for total earnings of $112.4 million. This cluster has a slightly lower than average concentration of economic activity in the county when compared to the nation s economic activity in this cluster overall. With a location quotient (LQ) of.97, this industry cluster is slightly below or about average in terms of concentration. Cluster Definition An industry cluster is a group of similar industries closely connected by supply chains and/or similar labor pools located within the same region. The core strength of the and Logistics industry cluster comes from truck, rail and warehousing. These core industries not only have high employment numbers but also drive employment and inputs from other industries supporting them. Other direct cluster employment primarily comes from industries that support these core industries such as specialty transportation (couriers, towing, charter bus, household/office moving). Key Strengths The strength of the and Logistics cluster is, of course, directly tied to the other Fond du Lac County industry clusters, most of which require heavy truck, rail and warehousing (including specialized warehousing and transportation for the food industry). Wages in this industry cluster are well above average at $65,676. Average earnings including wage and benefits are $40,212 for Fond du Lac County and $42,046 for the 7-County Region (Fond du Lac, Calumet, Dodge, Green Lake, Sheboygan, Washington and Winnebago counties). Fond du Lac County serves as a central location with excellent highway access to major markets in Green Bay (70 miles), Madison (70 miles), Milwaukee (60 miles), Chicago (140 miles) and Minneapolis (260 miles). A location quotient (LQ) measures how concentrated an industry cluster is in a given region as compared to the nation. An LQ greater than 1.0 means the cluster is an export industry. Industries with a high LQ are typically, but not always, export-oriented industries bringing money into the region rather than simply circulating money that is already in the region. An LQ of <1.0 means it typically has to import from outside to satisfy local demand. Value Chain An essential component for an industry cluster is the local supply chain. Although not all inputs (goods or services) that an industry cluster needs can be produced in the local economy, it is desirable to meet as many of the cluster s needs locally as possible. Total requirements, meaning how much this cluster purchases from other local supporting industries, are $69 million. Industries that support the & Logistics industry cluster employ 9,244 workers from 517 establishments in Fond du Lac County. These industries include other specialty transportation; transportation support activities; airport-related operations and activities; and other requirements that don t have direct cluster employment. The average annual wage for these supporting jobs is $36,079. 1
2 & Logistics Top Employers Employment of over 1,000 in freight trucking (local and long-distance) and specialized freight trucking is spread over many small trucking firms, many of which are owner operated. The largest trucking companies include TTI, Inc., Ottery and Osborn & Son Trucking. Extensive and flexible warehousing capability exists in the county. Top warehousing companies are Warehouse Specialists, Inc (WSI) and Ozburn-Hessey Logistics (OHL), each having over one million square feet of warehousing space, and on a smaller scale, Hoerth Storage, Inc. (with approximately 150,000 sq. feet). Two rail carriers, with employment of more than 350, operate in Fond du Lac County including: Wisconsin & Southern Railroad Co. and Canadian National. The Village of North Fond du Lac is home to the largest railroad switching yard in the State of Wisconsin. Market Opportunities Uncovering Gaps Gaps = Market Opportunities The Fond du Lac County Economic Development Corporation completed an industry cluster gap analysis in A gap analysis shows how much an entire industry cluster purchases from various other industries (its requirements ), along with how much is satisfied by those industries inside and outside the county or region. A gap occurs when industries that produce inputs (goods or services) needed by the core industries of a cluster are missing (no establishments) or are underdeveloped. Although not all inputs that an industry cluster needs can be produced efficiently in the local economy, it is desirable to meet as many of the cluster s needs locally as possible. Identifying and closing the gaps results in the following benefits: Industries that support the and Logistics industry include specialty transportation; transportation support activities; airport-related operations and activities; and other requirements that don t have direct cluster employment. Total requirements, meaning how much this cluster purchases from local supporting industries, are $69 million. Quicker delivery of goods with less transportation costs for core industries, More money brought into and kept in the county and region, Job creation, An attractive business environment for the missing or underdeveloped industries in the cluster: no or few local competitors; established assets and sales opportunities; pool of skilled workers and, Increased competitiveness of cluster overall. So what is the unmet need of this cluster? The chart on the following page highlights potential market opportunities of the and Logistics industry cluster in Fond du Lac County and the 7-County Region. The following cluster map illustrates the primary or core industries as well as the supporting industries of this industry cluster. Industries represented in rectangles with no shading/fill reveal substantial unmet needs or gaps in the region. Data Sources: EMSI Strategic Advantage 4th Q 2009 & 1st Q 2010 data; Reference USA Company listings - June, 2010; Wisconsin Department of Workforce Development LMI - Quarterly Census of Employment & Wages - annual 2008; WI DWD OES wages, 2009; Hoover s Company Data, July,
3 & Logistics Market Opportunities Industry Unmet Need in County Unmet Need in 7-County Region* Earnings Per Worker in Region (wage and benefits)** # of Establishments/ # of Employees in County Couriers NAICS $4.4 million $10.8 million $26,640 2 establishments/ 68 employees Freight Arrangement NAICS $2.8 million $10 million $59,712 Support Activities for Air NAICS $1.3 million $5.5 million $39,444 Used Household and Office Goods Moving NAICS $4.6 million $39,363 2 establishments/ 23 employees Trucking, Local NAICS $6.2 million $49, establishments/ 166 employees Other Airport Operations NAICS $2.2 million $39,262 * 7-County Region includes Fond du Lac, Calumet, Dodge, Green Lake, Sheboygan, Washington and Winnebago counties. **Average earnings (wage and benefits) is $40,212 for county; $42,046 for region (per EMSI). Data Sources: EMSI Strategic Advantage 4th Q 2009 & 1st Q 2010 data; Reference USA Company listings - June, 2010; Wisconsin Department of Workforce Development LMI - Quarterly Census of Employment & Wages - annual 2008; WI DWD OES wages, 2009; Hoover s Company Data, July,
4 and Logistics Industry Cluster Map I Fond du Lac County, WI Airport (Industrial Access, etc.) Support Activities for Air Other Airport Operations Manufacturing for Airport Equipment (several NAICS codes) Support Activities for Freight Arrangement Rental, Leasing and Related Activities of Equipment Wholesalers of Equipment and Merchandise (several NAICS codes) Core Strength: Truck, Rail and Warehousing Trucking, Long Distance LTL and TL Rail Specialized Trucking, Local and Long Distance Core Industries Trucking Local Refrigerated Warehousing and Storage General Warehousing and Storage Speciality Couriers Motor Vehicle Towing Charter Bus Industry Used Household and Office Goods Moving Other Requirements/ Supports Management, Professional and Financial Services Engineering Services Utilities Red outline = Jobs within direct/defined Cluster Lt orange shading/fill = Support requirement for cluster substantially satisfied in 7-county region* *7-county region=fond du Lac, Calumet, Dodge, Green Lake, Sheboygan, Washington & Winnebago Counties No shading/fill= Support requirement has a substantial gap in 7-county region*
5 and Logistics Market Opportunities I Fond du Lac County, WI 2007 North American Industry Classification System (NAICS) Definitions Couriers and Express Delivery Services providing air, surface, or combined mode courier and express delivery services of parcels, but not operating under a universal service obligation. These parcels can include goods and documents, but the express delivery services are not part of the normal mail service. These services are generally between metropolitan areas or urban centers, but the establishments of this industry form a network that includes local pick-up and delivery to serve their customers needs Freight Arrangement arranging transportation of freight between shippers and carriers. These establishments are usually known as freight forwarders, marine shipping agents, or customs brokers and offer a combination of services spanning transportation modes. Includes: Shipping Agents; Customs brokers; Freight forwarding; Marine shipping agency; Shipping agents (freight forwarding) Other Support Activities for Air providing specialized services for air transportation (except air traffic control and other airport operations). Includes: Aircraft ferrying services; Aircraft inspection services; Aircraft maintenance and repair services (except factory conversion, factory overhaul, factory rebuilding); Aircraft testing services; Fueling aircraft on a contract or fee basis; Independent pilot, air (except owner-operators); Inspection services, aircraft; Maintenance and repair services, aircraft (except factory conversion, factory overhaul, factory rebuilding); Testing services, aircraft Trucking, Local This industry comprises establishments primarily engaged in providing local general freight trucking. General freight establishments handle a wide variety of commodities, generally palletized and transported in a container or van trailer. Local general freight trucking establishments usually provide trucking within a metropolitan area which may cross state lines. Generally the trips are same-day return. Includes: Bulk mail truck transportation, contract, local; Container trucking services, local; General freight trucking, local; Motor freight carrier, general, local; Transfer (trucking) services, general freight, local; Trucking, general freight, local Other Airport Operations This U.S. industry comprises establishments primarily engaged in (1) operating international, national, or civil airports, or public flying fields or (2) supporting airport operations, such as rental of hangar space, and providing baggage handling and/or cargo handling services. Includes: Aircraft hangar rental; Aircraft parking service; Airport baggage handling services; Airport cargo handling services; Airport operators (e.g., civil, international, national); Airport runway maintenance services; Airports, civil, operation and maintenance; Aviation clubs, primarily providing flying field services to the general public; Fixed base operators; Flying field operators; Hangar rental, aircraft; Maintenance services, runway; Parking services, aircraft; Runway maintenance services; Vacuuming of airport runways Used Household and Office Goods Moving providing local or long-distance trucking of used household, used institutional, or used commercial furniture and equipment. Incidental packing and storage activities are often provided by these establishments. Definition Source: US Census Bureau North American Industry Classification System Last Revised: September 3, 2008;
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