artsy shipping city: the transformation of duluth

Drew Digby, Regional Labor Market Analyst,Minnesota Department of Employment and Economic

Development

OverviewQuick movie about Duluth and the regionThe economic transformationThe dramatic recent changesWhat’s worked. What remain as our challenges

Duluth in 1980The two biggest employers in 1980 were the

government and manufacturing.Direct Manufacturing jobs in Duluth

accounted for exactly 12% of all jobs.Government jobs, including the air force

base, accounted for 23.9% of all jobs.About 5% of all jobs were related to the port

and railroads.

Duluth’s FallSome have said that Duluth is where the

Rust Belt began.In 1981, the U.S. Steel plant closed, followed

shortly afterward by the Duluth Air Force Base.

Unemployment rates in the 1980s reached 15%. Between 1980 and 1982, the number of people employed in Duluth fell by 4,000, or about 10% of all jobs in the city were just gone.

Duluth in 2009The unemployment rate in Duluth in October

2009 was 7.1%. It was the 6th month in a row that the unemployment rate was lower than both the state and national rates.

Even in the middle of the recession we have more than 58,000 jobs (compared to just 40,000 at the depths of the 1980s recession).

We have restaurants and stores opening in a recession. So much theater, music and other art that the biggest complaint is tracking it.

Higher EducationFive colleges and universities in the Twin

Ports (Duluth and Superior) enroll about 22,000 students.

October now matches the summer months for peak employment.

The institutions employ more than 2,800 workers at better than average wages .

Architecture and Engineering2003-2008. Sector grew by 72.4% in Duluth,

peaking at just over 800 employees before dipping slightly in the recession, though companies have been adding back substantially since March.

Computer System DesignJust one part of the Information Technology

Sector. It grew from 240 employees in 2003 to 468 in 2008.

The larger Information Technology sector has 1,290 professionals in the Metro area, plus support staff.

Health CareIn 2008, Health Care accounted for over 28%

of the jobs in Duluth and more than 30% of the wages.

Just a service? No the Duluth market has found a niche to export, access to services, especially a variety of long-term care.

Manufacturing and GovernmentManufacturing, now just 5.8% of the jobs,

less than half the percent just 30 years before.

Government Jobs, once nearly a quarter of all jobs, accounted for just 16.4% of the jobs in 2008, and that with higher education now accounting for a quarter of those jobs. Without the growth of colleges and universities, government employment would half what it once was.

Networks of SupportEntrepreneurial Support. Small business

development centers plus the Northeast Entrepreneur Fund plus various pools of investment capital and loans

The shifting terrain of economic development agencies, that despite struggles, have done some amazing things.

Professional organizations, especially in technology and professional fields

Private Investment, Public InitiativesThere have been some amazing investors

who’ve put their investment here. Hotels. Cirrus.

Interesting entrepreneurs: True Ride/Epicurean. Points North Consulting. Sinex Aviation. Alan Zeppa and Zeitgeist Arts

Key Recent InitiativesBridge SyndicateAttracting and Retaining Young AdultsSocial CapitalKnight Creative Communities Initiative

Art WorksSustainable Twin PortsPathways

Fit City DuluthDuluth at WorkBlandin Community Leadership Program

Key Recent InitiativesAt Home in DuluthCREATEStorefront Loan ProgramConnect the DotsPioneering Healthier CommunitiesProsperity AgendaFUSE Duluth/Duluth Young ProfessionalsThe DUSUPerfectDuluthDay.com

It’s the MomentumPathways. A train ride/bike ride and 6 bike

racks. But it started the momentum.Now it’s not just Grandma’s Marathon, but

the Ten-Hour TriathlonWould ArtWorks have gone anywhere without

Zeppa? Maybe, but the momentum they created together.

New Ideas, ways of doing things take time. Minnesotans aren’t the best with new ideas or new people.

Challenge: Economic SustainabilityHow long will all of these new ideas pay off?

Do we always need to be on the next curve?More theater/music? How do we educate the

audience and keep them growing.

Boomer RetirementsHow will businesses, community leadership,

non-profit intuitions react as the Boomers retire. Where will the pressures be on spending?

The B.A. dilemma One of the best thing a young adult can do

for their lifetime income is to get a B.A. degree, especially a B.A. degree in Liberal Arts.

The worst thing a young adult can do for their immediate job prospects in a smaller city is have a B.A. degree in the Liberal Arts.

Thank you

Drew DigbyRegional Labor Market Analyst

Department of Employment and Economic Development

State of Minnesota218.723.4775

drew.digby@state.mn.us