From the June 2014 South Dakota e-Labor Bulletin
The Labor Market Information Center (LMIC) recently completed the 2012-2022 round of South Dakota employment projections by industry and class of worker. Historical time-series data and state and national economic trends were incorporated in various statistical models to project employment levels. (A general assumption is made that no major catastrophic events or natural disasters will occur during the projection period that would significantly affect economic activities of these industries.)
A look at which types of industries are growing, and which are not, provides a synopsis of the economy as a whole. From 2012 to 2022, the total number of workers in South Dakota is projected to increase by 33,225 (or 7.0 percent) to a total of 505,870 workers. On the national level, the total employment level is expected to increase by 15.6 million jobs (10.8 percent, or about 1.0 percent annually). The national growth rate is higher than South Dakota's rate because the United States was hit harder with job losses during the recession. Therefore, the national projections include a higher rate to account for recovery from the recession.
The South Dakota projections include three categories of workers:
The 'nonfarm wage and salaried workers' category includes an estimate of workers by industry based on estimates produced by the U.S. Bureau of Labor Statistics through the Current Employment Statistics (CES) Survey. The active CES sample includes approximately 17 percent of all nonfarm covered workers. In addition to the unemployment insurance (UI) covered businesses, employers who are exempt from UI laws are also surveyed as part of the CES sample. The establishments include those who work for non-profit organizations, such as private colleges and religious organizations. Making up 86.4 percent of the workforce, this category is the major component in South Dakota. The nonfarm wage and salaried workers category is also projected to grow 7.9 percent by 2022 -- the most for any category.
|South Dakota Wage and Salaried Workers by Industry Division
|Actual Change||Percent Growth|
|Total of All Industries||472,645||505,870||33,225||7.0%|
|Non-agricultural Self-Employed and Unpaid Family Workers||28,200||29,165||965||3.4%|
|Agriculture, Forestry, Fishing & Hunting (farm employment)||35,880||35,890||10||0.0%|
|Nonfarm Total Wage and Salaried Workers
(excludes self-employed and unpaid family workers)
Employment in the Agriculture, Forestry, Fishing and Hunting industry (agriculture and related workers (farm employment) is the only category projected to stay relatively stable in South Dakota over the next 10 years.
Nationally, overall employment in Agriculture, Forestry, Fishing and Hunting is expected to decrease by 223,500 workers (or 10.6 percent) through 2022. This industry has been declining since 1980 both nationally and in South Dakota. One of several reasons cited for the declines is the consolidation of smaller farms; technological advances have also improved production and efficiency while requiring fewer workers.
|South Dakota Industry Employment Projections 2012 - 2022
Top Ten in Industry Growth
|Ambulatory Health Care Services||14,910||17,540||2,630||17.6%|
|Professional, Scientific and Technical Services||11,540||13,450||1,910||16.6%|
|Museums, Historical Sites, and Similar Institutions||505||585||80||15.8%|
|Construction of Buildings||5,095||5,885||790||15.5%|
|Waste Management and Remediation Services||800||915||115||14.4%|
|Heavy and Civil Engineering Construction||3,270||3,725||455||13.9%|
|Wholesale Electronic Markets and Agents and Brokers||1,530||1,740||210||13.7%|
|Transportation Equipment Manufacturing||2,750||3,115||365||13.3%|
|Specialty Trade Contractors||11,765||13,320||1,555||13.2%|
The South Dakota industries projected to grow the most over the next 10 years are trending consistently with the rest of the nation. The service-providing industries are anticipated to generate most of the 10.8 percent national employment growth according to the U.S. Bureau of Labor Statistics (BLS). Nationally, industries related to health care, personal care and social assistance, and construction are projected to have the fastest job growth between 2012 and 2022. The Health Care and Social Assistance sector is projected to account for nearly one-third of the total projected increase in jobs nationally, adding 5 million jobs.
Ambulatory Health Care Services
In South Dakota, the number of workers employed in the Ambulatory Health Care Services subsector is projected to increase by 2,630 workers (or 17.6 percent) over the next 10 years. This subsector provides health care services directly or indirectly to ambulatory patients and typically do not provide inpatient services. According to the BLS, the Outpatient, Laboratory and Other Ambulatory Care subsector is expected to be among the largest and fastest growing industries in terms of both employment and real output. Nationally, this subsector is projected to increase by 522,300 workers (45.4 percent) in the coming decade. The aging population and advancements in medical technologies will help ensure continued worker growth within the health care services industry. The continuing shift from inpatient care to outpatient treatment will boost worker growth in outpatient care centers across South Dakota.
Professional, Scientific and Technical Services
The Professional, Scientific and Technical Services subsector is projected to add 1,910 workers in South Dakota (16.6 percent) over the next decade. This subsector is comprised of establishments that make available the knowledge and skills of their employees, often on an assignment basis, where an individual or team is responsible for the delivery of services to the client. The individual industries of this subsector are defined on the basis of the particular expertise and training of the services provider. This industry includes several subsectors such as legal services, accounting services, engineering services, management consulting, computer design services, etc. A major force contributing to the growth of this subsector has been the continued advancements in science and technology.
Museums, Historical Sites and Similar Institution
Worker levels in the Museums, Historical Sites and Similar Institutions industry are projected to increase by 80 workers (15.8 percent). This growth is driven by the retirement of more baby boomers who will likely take advantage of more opportunities for travel and participating in leisure activities as businesses such as casinos, golf courses and amusement establishments. Another factor to consider in South Dakota pertaining to this subsector's growth is "stay-cations," with families choosing to make in-state visits to save on travel expenses.
Construction of Buildings
The Construction of Buildings subsector in South Dakota is projected to increase worker levels by 790 (15.5 percent). The 15.5 percent growth is actually much lower than historical patterns due to the recession's toll on the industry from 2009 to 2010. During the recession, the South Dakota worker levels within this sector remained relatively stable compared to the United States. South Dakota's projected growth is less substantial than national figures due to far less impact from the recession. Job growth will result from increased construction of homes and office buildings, remodeling projects and the repair and replacement of the infrastructures. Even if the South Dakota and national economies do not experience robust growth in the next 10 years, the continued shifts in county populations from internal migration will keep construction demand up to some degree.
Waste Management and Remediation Service
The Waste Management and Remediation Services industry in South Dakota is projected to increase by 115 workers (14.4 percent) by 2022. This subsector is engaged in the collection, treatment and disposal of waste materials. Growth in this industry is driven by an increasing population and privatization of waste collection services. With population growth there is more waste generated which increases the demand for the Waste Management and Remediation Service subsector. Environmental and recycling regulations can also drive the need for an increased workforce.
Heavy and Civil Engineering Construction
The number of workers in the Heavy and Civil Engineering Construction subsector is projected to increase by 455 (13.9 percent). This subsector includes entities whose primary activity is the construction of entire projects such as highways, bridges, land subdivisions and utility systems. A major factor in this industry's growth is aging infrastructures and the need to maintain or replace components of highways and utility systems.
The Social Assistance subsector (in the Health Care and Social Assistance sector) is projected to increase by 1,215 workers (13.8 percent) by 2022 in South Dakota. Industries in this subsector provide a wide variety of assistance services directly to their clients. This includes individual and family services, emergency and other relief services, vocational rehabilitation and child day care. Employment will be driven largely by the shift in demand for services from higher cost in-patient facilities to lower cost individual and family service providers.
Wholesale Electronic Markets and Agents and Brokers
The Wholesale Electronic Markets and Agents and Brokers subsector is projected to increase by 210 workers (13.7 percent) over the next 10 years in South Dakota. Industries in this subsector arrange for the sale of goods owned by others, generally on a fee or commission basis. This subsector's projected growth mirrors what is expected for its parent industry of Wholesale Trade. In South Dakota, the Wholesale Trade sector overall is projected to increase by 1,600 (8.2 percent) over the next decade. Nationally, employment in this industry is projected to experience one of the largest increases, 470,400 jobs, over the projection period. Wholesale trade involves businesses providing goods and services to other businesses, not consumers. As long as there is expansion in other industries, the Wholesale Trade industry will expand as well -- especially so in electronic markets where technology is predominate.
Transportation Equipment Manufacturing
The worker levels in this subsector are projected to increase by 365 workers (13.3 percent) in South
Dakota by 2022. The Transportation Equipment Manufacturing subsector produces equipment for transporting people and goods. Transportation equipment is a type of machinery. An entire subsector is devoted to this activity because of the significance of its economic size. As the economy grows and the demand for goods increases, transportation equipment manufacturing will be in higher demand to help facilitate the transportation of those goods to businesses and consumers.
Specialty Trade Contractors
The Specialty Trade Contractors subsector in South Dakota is projected to increase by 1,555 workers (13.2 percent) through 2022. This primary activity of establishments within this subsector is to perform specific activities related to building construction or other similar activities for all types of construction. Therefore, individual business establishments are not responsible for the entire project. Business establishments within this subsector typically perform activities such as pouring concrete, site preparation, plumbing, painting and electrical work. This subsector's growth is closely related to the Construction of Buildings subsector. Nationally, the Construction industry was one of the hardest hit industries during the recession. As the economy continues to show growth and demand for improvement in existing and new buildings, the Specialty Trade Contractors subsector will continue to grow.
|South Dakota Industry Employment Projections 2012 - 2022
Declining & Slowest Growing Industries
|Broadcasting (except Internet)||1,110||1,080||-30||-2.7%|
|Textile Product Mills||375||365||-10||-2.7%|
|Motion Picture and Sound Recording Industries||545||535||-10||-1.8%|
|Couriers and Messengers||1,285||1,265||-20||-1.6%|
|Publishing Industries (except Internet)||1,635||1,610||-25||-1.5%|
|Computer and Electronic Product Manufacturing||2,260||2,230||-30||-1.3%|
|Miscellaneous Store Retailers||2,925||2,900||-25||-0.9%|
Declining industries are a result of several factors. Some South Dakota industries are in decline due to advances in technology, changes in business practices and other factors. According to the BLS, there are several macroeconomic factors, such as labor force trends, gross domestic product (GDP) and its components, and labor productivity that affect the growth in total employment. Nationally, a few sectors such as manufacturing, utilities, information and federal government are projected to experience a slight decline in employment in the next ten years. The slight decline in employment is related to expected productivity gains and consolidation of firms. Declines in South Dakota are projected to be minimal. But since many South Dakota industries are considered small, even a small loss in employment levels in the projected 2022 value can notably impact a subsector.
Worker levels in the Air Transportation subsector are projected to decrease by 15 workers (7.1 percent) through 2022 in South Dakota. Industries in the Air Transportation subsector provide air transportation of passengers and cargo using aircraft such as airplanes or helicopters. This subsector is contained in the Transportation and Warehousing sector. Nationally, this subsector is projected to decline by 52,100 workers (11.4 percent) over the next 10 years. The declines projected on the national and state levels can be attributed to technological innovation.
The Private Households subsector (in the Other Services, except Public Administration industry) is projected to decrease 100 workers (5.3 percent) by 2022 in South Dakota. The Private Households subsector includes households that employ workers on or about the premises in activities primarily concerned with the operation of the household. The recession impacted the Private Households industry, as some families could no longer afford the luxury of hiring individuals, such as cooks, maids or gardeners to take care of the daily running of the household. In South Dakota, most parents typically take advantage of daycare providers or youth recreational centers rather than hiring a household worker such as a nanny. As the decline in this subsector continues, it will likely increase employment in other subsectors such as the Social Assistance subsector which includes child daycare services.
Broadcasting (except Internet)
Worker levels in the Broadcasting (except Internet) subsector are projected to decrease by 30 workers (2.7 percent) by 2022. This subsector includes establishments that create content or acquire the right to distribute content and subsequently broadcast the content. Nationally, the trend for this subsector is also on the decline. According to the BLS, the information sector overall is projected to decrease nationally by 65,200 workers (2.4 percent) by 2022. Much of this trend is attributed to the decrease in broadcasted information caused by the rise of available information on the Internet, use of social media, etc.
Textile Product Mills
Worker levels in the Textile Product Mills subsector are projected to decrease slightly by 10 workers (2.7 percent) in the next decade. This subsector includes establishments that make textile products, excluding apparel. On a national level, this subsector is projected to be one of the most rapidly declining industries due to technological advances. Innovative machines are increasingly being utilized to replace the labor it once took to manufacture most textile goods.
Motion Picture and Sound Recording Industries
The Motion Picture and Sound Recording subsector in South Dakota is projected to have a slight decrease of 10 workers (1.8 percent) through 2022. Employment in this subsector is involved in the production and distribution of motion pictures and sound recordings. This subsector is included in the Information sector, which is also projected to have an overall decline in South Dakota. A major factor in the Motion Picture and Sound Recording subsector is the use of technological improvements in movie making and sound recording equipment, which will require fewer individuals to complete the final product. Nationally, the Audio and Video Equipment Manufacturing four-digit NAICS subsector is projected to decline by 3,500 workers (17.6 percent). The fall in demand for Audio and Video Equipment Manufacturing has a direct relationship to the Motion Picture and Sound Recording subsector.
Couriers and Messengers
Worker levels in the Couriers and Messengers subsector are projected to decrease by 20 workers (1.6 percent) by 2022. Individuals involved in this subsector provide intercity and/or local delivery of parcels. Nationally, this subsector is projected to decline as well, by 44,000 workers (8.3 percent) through 2022. Technological advancements and improvements in communications efficiencies have dampened consumer demand in this particular subsector.
Publishing Industries (except Internet)
The number of workers employed in the Publishing Industries subsector is projected to decline by 25 workers (1.5 percent) in South Dakota. This subsector of the Information industry includes establishments engaged in the publishing of newspapers, magazines, other periodicals and books, as well as database and software publishing. The main reason for the slight worker decline in this subsector is the continued rise of Internet usage. The information and availability of content on the Internet creates less demand for newspapers and other printed materials.
Computer and Electronic Product Manufacturing
The number of workers in the Computer and Electronic Product Manufacturing subsector is projected to decrease by 30 workers (1.3 percent). This subsector is comprised of establishments that manufacture computers, computer peripherals, communications equipment and similar electronic products, as well as the establishments that manufacture components for such products. Technological advancements have improved the manufacturing process, consequently requiring less labor to achieve the same, if not greater, production output.
Worker levels in the Paper Manufacturing subsector are projected to decrease slightly by 10 workers (1.3 percent). This subsector includes establishments that make pulp, paper or converted paper products. The manufacturing of pulp involves separating the cellulose fibers from other impurities in wood or used paper. The manufacturing of paper involves matting these fibers into a sheet. Converted paper products are made from paper and other materials by various cutting and shaping techniques. The availability of information on the Internet and improved efficiencies in manufacturing processes has both contributed to the projected worker decline in this subsector.
Miscellaneous Store Retailers
The Miscellaneous Store Retailers subsector is projected to decrease by 25 workers (0.9 percent) over the next 10 years in South Dakota. This retail trade subsector is a catch-all for retailers who sell specific products that are not otherwise categorized in a specified retail code. Establishments in this subsector include stores with unique characteristics, such as florists, used merchandise stores, and pet and pet supply stores. Therefore, industrial coding can change often within this subsector.
The worker decline in this subsector is mainly due to industry coding changes. The Bureau of Labor Statistics (BLS), U.S. Department of Labor, administers the Annual Refiling survey in cooperation with all states, which includes an Industry Verification Form (IVF) employers complete to verify their industrial activity. The main purpose of the IVF form is to ask employers to verify a North American Industry Classification System (NAICS) industry description that represents their business's main activities. If the description provided on the survey form is correct, the employer is asked to check the appropriate box. If the description is incorrect, the employer is asked to briefly describe their business activities and the approximate percentage of the revenue or production derived from each activity. This system helps ensure consistent classification, which improves the statistics of all BLS programs that use the industry classifications.
The Telecommunications subsector is projected to decrease slightly by 10 workers (0.4 percent) over the next 10 years in South Dakota. This subsector is primarily engaged in operating, and/or providing access to facilities for the transmission of voice, data, text, sound and video. Nationally, the Telecommunications subsector is one of the more rapidly declining industries dropping by 51,000 workers (5.9 percent) through 2022. The major reason for the decline is the advancements in technology. As the Telecommunications subsector continues to become more technologically advanced and efficient, less workers will be needed.