Slow population growth in region helps limit workforce
By: John Cropley
‘This problem is going to persist for some time due to the baby boomers’
As economic developers work to attract, grow and retain employers in the Capital Region, they keep bumping into a problem: The region is barely adding people to take new jobs.
Employers already operating in the region report a labor shortage, and businesses considering moving here must also consider where they’ll find the talent they need.
From 2000 to 2016, the nation’s population grew 14.8 percent, while New York’s population grew 4 percent. The fastest-growing states in the same period included Texas (33 percent), Arizona (36 percent) and Nevada (47 percent).
Almost all of New York state’s growth over that period was in New York City and its three closest suburban counties. The four counties at the core of the Capital Region — Albany, Rensselaer, Saratoga and Schenectady — accounted for the rest of the growth. Some other counties in upstate New York saw population growth, but it was neutralized statistically by the counties that lost population.
In recent years, even growth in the five-county Albany-Schenectady-Troy metropolitan area has slowed: From the 2000 Census to the 2010 Census, population grew 5.4 percent, but from the 2010 Census to the 2016 tally, the population grew only 1.3 percent, while the nation added 4.7 percent.
Marty Vanags, head of Saratoga County’s designated economic development agency, said population growth and labor availability are things he is asked about often.
“That’s always an issue; they want to know about the labor supply,” he said. “When it comes down to a specific project, they want to know where the workers are. A tight labor market is always going to be a concern for them. But they take it on a case-by-case basis.”
Vanags, president of the Saratoga County Prosperity Partnership, said a lot of economic developers face similar questions in a robust economy. It’s partly a structural issue, as the large Baby Boom generation retires and smaller generations replace them.
“The situation that we’re facing is no different,” he said. “When I talk to my peers around the country, they’re no different.
“This problem is going to persist for some time due to the baby boomers.”
Labor force participation — the percentage of working-age people holding or actively looking for jobs — is one metric in which the Albany area is strong, as would be expected with a growing economy, low unemployment rate and limited population growth. Its participation rate in 2015 was 79.6 percent among residents aged 20 to 65, compared with 77 percent statewide and 76.8 percent nationwide, by Census Bureau estimates.
The Capital District Regional Planning Commission, an advisory body, has been tracking population trends for many years. It noted the slow population growth in its recently released summer 2017 data report. CDRPC senior planner Dan Harp, editor of the report, said the numbers draw an interesting picture.
“It seems even though the population growth has slowed almost to zero, we have a very low unemployment,” he said. “It just seems like our economy is the right size for our region. To put it mildly, it’s a unique situation.”
He also noted in the report that, while the great population loss Albany, Schenectady and Troy saw in the second half of the 20th century has halted, growth in the region has mainly been outside those cities. From 1995 to 2015, the region gained about 55,000 people and developed about 56,000 acres of suburban and rural land for single-family housing.
One of the developers working to bring new economic activity to the area, Ray Gillen of the Schenectady County Metroplex Development Authority, said the labor shortage is real, but it can be overcome. He said Schenectady County is in a good position, able to draw commuters from the west, where unemployment is higher, as well as from the east, where the greatest concentration of people and public transportation options exist.
When he’s pitching the county and a prospective employer asks about labor availability, Gillen points to recent projects that have been able to secure the workforces they need. There are multiple examples, he said, but the most visible is Rivers Casino & Resort in Schenectady. When it opened six months ago, it projected a workforce of 1,150, and in its most recent regulatory filing, it reported a workforce of 1,111 — despite 470 employees having quit or been fired over the six months.
“We think we offer great access to workforce,” Gillen said. “We point to recent expansions and companies that have moved in and staffed up.”
James Ross, Capital Region labor analyst for the state Department of Labor, said the Albany area is a bright spot within upstate New York, but even the outer edges of the Capital Region struggle with population loss.
“In several of the counties in the Capital Region, deaths are outnumbering births,” he said.
(The “Capital Region,” as defined by the state Department of Labor, is Albany, Columbia, Greene, Rensselaer, Saratoga, Schenectady, Warren and Washington counties; of the eight, Columbia and Greene lost population from 2000 to 2016, Washington gained slightly, and the others gained more significantly. The Albany-Schenectady-Troy metropolitan area, as defined by the U.S. Census Bureau, is Albany, Rensselaer, Saratoga, Schenectady and Schoharie counties; Schoharie County is the only one of the five losing population.)
Growth and shrinkage can cut both ways. Saratoga County was one of the fastest-growing counties in the state from 2010 to 2016, adding 3.4 percent population. By July 2017, it had the second-lowest unemployment rate in the state, at 3.8 percent. Columbia County is the fastest-shrinking county in the Capital Region, losing 3.3 percent of its population from 2010 to 2016. It had the lowest unemployment rate in the state in July 2017, at 3.6 percent.
There are other major differences between the two counties, including median household income: $71,496 in Saratoga County and $59,105 in Columbia County.
The regional non-profit development agency, the Center for Economic Growth, sees bright spots in the picture: Cohoes was the fastest-growing city in the state from 2015 to 2016, while Glens Falls and Saratoga Springs were both on the top 10 list. But it also noted population drops over the same period in the major cities: Albany, Schenectady and Troy.
So, CEG views attracting new residents to be an important part of regional growth.
“Due to the Capital Region’s strong economy, there are some industry sectors that are struggling to find skilled labor,” said Andrew Kennedy, president of CEG.
CEG Talent Connect will attend career events at MIT in September and Connecticut in October on behalf of Capital Region employers and schools.
On Wednesday, it attended the U.S. Army’s Soldier for Life-Transition Assistance Program’s quarterly career and education fair at Fort Drum, and it plans to attend the next one in November.
Kennedy said CEG sees military members leaving active service — there are about 250 a month from Fort Drum alone — as potential new Capital Region residents.
“Many are looking for jobs or G.I. Bill-related educational opportunities,” he explained via email. “These are highly skilled, disciplined workers whom our employers and academic institutions would love to have, so CEG is targeting our attraction efforts to bring top-tier talent to the Capital Region to fill those critical jobs and continue our economic growth.”
The following U.S. Census data show the population changes of several counties in the greater Capital Region in 2000, 2010 and 2016:
New York state
Jobless in New York
Some facts about unemployment in New York state in 2016 from the U.S. Bureau of Labor Statistics:
An average of 463,400 people were unemployed (available to work and had looked for a job within the last four weeks).
An average of 326,000 people were working involuntary part-time jobs (either their full-time job had been cut back or they sought full-time employment and could land only part-time).
An average of 124,400 were marginally attached to the workforce (want to work, had looked for a job in the last 12 months, but hadn’t looked in the last four weeks for various reasons such as school or family commitments).
An average of 32,600 of the marginally attached were discouraged workers (unemployed and not looking for work because they believe there are no jobs for them).
Those unemployed 15 weeks or longer: 2.3%
Those who lost a permanent or concluded a temporary job: 2.4%
Total unemployed as a percent of labor force: 4.8%
Total unemployed plus discouraged workers: 5.1%
Total unemployed plus all marginally attached to labor force: 6.0%
Total unemployed plus marginally attached plus involuntary part-time: 9.4%
Labor force participation
Year-to-year and month-to-month blips notwithstanding, the number of Americans working or actively looking for work increased gradually from 1950 to 2000, decreased gradually from 2000 to 2013, and has held steady since 2014.
The changes since 2000 are attributed to several factors, including more teens going to school instead of working; baby boomers aging out the workforce; and more people receiving disability compensation rather than working.
One of the few demographic groups to increase labor force participation since the turn of the century is men and women aged 55 to 64, possibly due to longer life spans, diminished private retirement plans, changes to Social Security laws and rising health care costs.
Labor force participation among adults ages 20 to 64 in New York is 77%. Across the nation, it ranges from 67.4% in West Virginia to 84% in North Dakota.
In New York state, participation ranges from 6.5% for ages 75 and older to 83.2% for ages 30 to 34; 61.6% for blacks, 63.7% for whites, 64.4% for Latinos and 65.3% for other races; 81.4% for males, 72.8% for females; 48.3% for those below the poverty level, 82.9% for those at or above; 39.1% for the disabled; 60.4% for high school dropouts, 72.9% for high school graduates, 86.9% for those with at least a four-year college degree.