MSP Regional Recovery Hub Weekly Take: Making Sense of our Jobs Recovery
The big thing you should know about economic recovery in the Minneapolis Saint Paul region for the week of February 15th.
This Week’s Big Thing: starting to make sense of our jobs recovery. Two important reports were published in the last two week that help to make sense of jobs recovery in the MSP region. First, a COVID-19 Impact Report from RealTime Talent, breaking down jobs posting trends in MSP and Minnesota throughout the COVID-19 pandemic in 2020. This analysis of job postings by occupation type gives us a glimpse at the immediate impacts on the type of work that was demanded by employers throughout 2020. The second analysis comes from McKinsey & Company, a report on the future of work after COVID-19. This analysis of occupations is a first look at the type of work that will happen in the future, shaped largely by disruptions from COVID-19 that are not likely to go away. Together, the two analyses paint a picture of how we should be thinking about job recovery in the region.
First, a reminder of job posting activity in MSP in 2020. Job postings are tracked in the Regional Recovery Hub, reported monthly as the number of new unique job postings and contributed by RealTime Talent. Similar to patterns seen statewide, 2020 job postings in the 7-county metro broke with historical trends of high volumes through summer months and declines in December and January. Overall postings were down six percent from 2019 to 2020. The initial response to COVID-19 resulted in a considerable decline in overall volume of new postings in April 2020 from an all-time high of about 68,500 new jobs posted in February. In December 2020 there were 60,514 new job postings, a striking 21% jump in volumes from one year prior. This increase in job posting activity is notable as it is the first month since the COVID-19 pandemic began that conditions surpassed pre-COVID-19 (2019) conditions.
RealTime Talent’s deeper analysis found that while employer demand for talent dropped considerably for occupations in the Hospitality and Tourism cluster and Arts, Audio/Visual, and Communications cluster, there was an increase in employer demand for occupations in the Engineering, Manufacturing, and Technology cluster and Health Science cluster.
These findings of the immediate disruptions to the MSP labor market provide a signal for longer-term impacts to employer demand for talent. McKinsey examined labor market activity across eight countries, clustering occupations using a new COVID-related approach: based on the interpersonal interactions that are required to perform the occupation, to understand the post-COVID economy labor demand. They found that jobs in work arenas with higher levels of physical proximity are likely to see greater transformation after the pandemic, a longer standing impact of the disruptions caused by COVID-19. Based on these findings, we can expect that many of the low-wage occupations that required close contact with customers and coworkers are less likely to be demanded by employers in the future and more likely to be automated using technology. This is the case for many of the occupations in the food service, leisure and arts occupations that experienced a drop in demand in 2020. At the same time, remote work is expected to continue in various hybrid workplace models, meaning many of the professional occupations that saw increased demand late in 2020, like engineering and technology occupations, will continue to see an increase in demand from employers. McKinsey’s report estimates that almost all growth in labor demand will occur in high-wage jobs, supporting the critical need for reskilling that is needed to shift workers from low-wage to high-wage occupations.
In addition to checking out these reports from RealTime Talent and McKinsey, remember that you can track regional economic recovery by visiting the MSP Regional Recovery Hub. The Hub is in beta, which means we are actively working to enhance the functionality to make sure it works for you. If you have any questions or feedback on the Recovery Hub, or would like to learn more about getting involved contact Amanda Taylor, Vice President of Research & Intelligence.