Call Center Location Advisory & Economic Incentive Services
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1 Regional Workforce Analysis Marcy, NY Call Center Location Advisory & Economic Incentive Services Statement of Qualification February October , 2013
2 Executive Summary Marcy, NY and the surrounding region has a readily available and qualified workforce to satisfy a large scale electronics manufacturing and semiconductor processing operation. Based on a survey of 22 production employers, the effective labor shed from Marcy, NY is 90 miles and that includes a population of 2.9m and a labor force of 1.5m. There are 26 post secondary education institutions within 90 miles of Marcy, NY that all complete students in target engineering or technician programs. The institutions graduate 2,500+ students in those programs annually. 65% of those graduates are forced to look outside the region for jobs in their fields. There are 6,911 target engineers and 2,611 target technicians living within a 90 mile radius of Marcy, NY. When compared against the average market in North Carolina, Oregon, Texas and Virginia, the Mohawk Valley Region scores favorably as it relates to labor availability, education attainment, and labor costs. Regional, large scale manufactures have a positive experience with the region s workforce and express confidence in the long term labor supply. 2
3 QUANTITATIVE WORKFORCE ANALYSIS 3
4 Education & Occupation Titles Titles Used for Analyses Each of the quantitative workforce analyses assess both education output clusters and target occupation clusters. The specific titles for each cluster that appears throughout the analyses are included below. Education Degree Titles ENGINEERING Chemical Engineering Electrical, Electronics & Communication Engineering Industrial Engineering Mechanical Engineering Materials Engineering TECHNICIAN Electrical Engineering Technician Electromechanical Instrumentation and Maintenance Technician Industrial Engineering Technician Mechanical Engineering Technician Occupation Titles ENGINEERING Chemical Engineers Electrical Engineers Electronics Engineers, Except Computers Industrial Engineers Materials Engineers Mechanical Engineers TECHNICIAN Electrical Engineering Technician Electromechanical Technician Industrial Engineering Technician Mechanical Engineering Technician 4
5 Target Program Completions 90 Mile Radius Around Marcy, NY The following table shows the number of completing students by attainment level for the academic calendar. The data reflects a 90 mile radius around Marcy, NY. The degrees titles are outlined on the previous slide. TOTAL DEGREES BELOW ASSOCIATES ASSOCIATES BACHELORS POST BACHELORS 5 MARCY, NY (90 MILE RADIUS) ENGINEERING Cornell University Rensselaer Polytechnic Institute SUNY at Binghamton Syracuse University Clarkson University (103 miles from Marcy) Union College Union Graduate College SUNY at Albany TOTALS 1, , TECHNICIANS Excelsior College (Online) SUNY Institute of Technology at Utica Rome Mohawk Valley Community College Hudson Valley Community College Onondaga Community College ITT Technical Institute Albany ITT Technical Institute Liverpool SUNY College of Technology at Delhi SUNY College of Technology at Canton (99 miles from Marcy) Schenectady County Community College Adirondack Community College Fulton Montgomery Community College Cayuga County Community College Broome Community College Corning Community College (115 miles from Marcy) 9 9 Tompkins Cortland Community College Morrisville State College 7 7 Jefferson Community College 3 3 TOTALS Source: US Department of Education
6 Target Program Completions Rochester, NY The following table shows the number of completing students by attainment level for the academic calendar. The data reflects the Rochester, NY MSA, a region just outside the 90 mile radius from which to recruit. TOTAL DEGREES BELOW ASSOCIATES ASSOCIATES BACHELORS POST BACHELORS ROCHESTER, NEW YORK (MSA) ENGINEERING Rochester Institute of Technology University of Rochester TOTALS TECHNICIANS Rochester Institute of Technology Monroe Community College Finger Lakes Community College TOTALS Source: US Department of Education
7 Graduate Surplus Analysis Annual Completing Students vs. Available Entry Level Jobs The following figure compares the number of students graduating in target programs from post secondary education institutions within a 90 mile radius of Marcy, NY to the number of annual entry level jobs. The data reflects the last academic year. Data for Rochester, NY was included since it is just outside the 90 mile radius. In each instance, graduates in each of the target programs are forced to leave the region to find employment. MARCY, NY (90 MILE RADIUS) ENGINEERS 553 1,792 1,239 Graduate Surplus MARCY, NY (90 MILE RADIUS) TECHNICIANS Graduate Surplus ROCHESTER, NY ENGINEERS Graduate Surplus ROCHESTER, NY TECHNICIANS Graduate Surplus STATE OF NEW YORK ENGINEERS 2,748 5,128 2,380 Graduate Surplus STATE OF NEW YORK TECHNICIANS 1,073 2,382 1,309 Graduate Surplus 0 1,000 2,000 3,000 4,000 5,000 6,000 7 Source: US Department of Education & UHS Global Insights Completing Students 2013 Estimated Entry Level Jobs
8 Occupation Concentration & Wage Data Engineering & Technician Occupation Clusters The following tables show employment and wage & salary statistics for target engineering and technician occupation clusters associated with an electronics manufacturing and semiconductor processing operation. The data represents a 90 mile radius around Marcy, NY. WAGE SCALE Engineering Occupation Cluster 2013 Employment Percent of Labor Force 2018 Employment Growth 0 Percentile 25th Percentile 50th Percentile 75th Percentile 100th Percentile Mechanical Engineers 1, % 2, % $66,498 $72,862 $81,266 $89,627 $97,947 Industrial Engineers 1, % 1, % $61,610 $67,517 $75,296 $83,054 $90,854 Electrical Engineers 1, % 1, % $75,733 $82,992 $92,456 $101,878 $111,155 Electronics Engineers, Except Computer 1, % 1, % $67,267 $73,715 $82,202 $90,646 $99,070 Chemical Engineers % % $70,054 $77,272 $86,694 $96,200 $105,539 Materials Engineers % % $65,998 $71,843 $79,643 $87,256 $94,931 TOTALS & AVERAGES 6, % 7, % $67,860 $74,367 $82,926 $91,444 $99,916 WAGE SCALE Technician Occupation Cluster 2013 Employment Percent of Labor Force 2018 Employment Growth 0 Percentile 25th Percentile 50th Percentile 75th Percentile 100th Percentile Electrical Engineering Technicians 1, % 1, % $20.26 $22.02 $24.40 $26.68 $29.04 Industrial Engineering Technicians % % $22.16 $24.10 $26.72 $29.23 $31.82 Mechanical Engineering Technicians % % $20.62 $22.41 $24.84 $27.16 $29.57 Electro Mechanical Technicians % % $19.19 $20.85 $23.11 $25.25 $27.47 TOTALS & AVERAGES 2, % 2, % $20.56 $22.35 $24.77 $27.08 $ Source: Economic Research Institute & UHS Global Insights
9 Occupation Concentration & Wage Data Maintenance & Production Occupation Clusters The following tables show employment and wage & salary statistics for target maintenance and production occupation clusters associated with an electronics manufacturing and semiconductor processing operation. The data represents a 90 mile radius around Marcy, NY. Maintenance Occupation Cluster Employment Percent of Labor Force 2018 Employment Growth 0 Percentile 25th Percentile WAGE SCALE 50th Percentile 75th Percentile 100th Percentile General Maintenance & Repair Workers 11, % 12, % $15.30 $16.36 $17.85 $19.07 $20.42 Supervisors of Mechanics & Repairers 3, % 4, % $32.27 $35.60 $39.97 $44.38 $48.73 Industrial Machinery Mechanics 2, % % $19.22 $20.50 $22.30 $23.87 $25.57 Maintenance Workers, Machinery % % $16.71 $17.85 $19.44 $20.77 $22.24 Industrial Electrical Repairers % % $19.80 $21.51 $23.83 $26.03 $28.32 TOTALS & AVERAGES 19, % 20, % $20.66 $22.36 $24.68 $26.82 $29.06 Production Occupation Cluster 2013 Employment Percent of Labor Force 2018 Employment Growth 0 Percentile 25th Percentile WAGE SCALE 50th Percentile 75th Percentile 100th Percentile Production Supervisors 4, % 5, % $24.07 $26.17 $29.01 $31.74 $34.56 Inspectors, Testers, Sorters, and Samplers 3, % % $17.02 $18.39 $20.26 $21.95 $23.74 Machinists 2, % % $18.42 $20.01 $22.16 $24.19 $26.31 Electrical & Electronic Assemblers 2, % % $11.79 $12.70 $14.03 $15.20 $16.47 Welders, Cutters, Solderers, and Brazers 2, % 2, % $16.71 $18.17 $20.14 $21.96 $23.87 CNC Machine Tool Operators % 1, % $22.02 $24.09 $26.86 $29.57 $32.34 Machine Tool Setters & Operators % % $14.13 $15.29 $16.91 $18.32 $19.80 Electromechanical Equipment Assemblers % % $19.40 $21.20 $23.64 $25.98 $28.41 Tool and Die Makers % % $21.91 $23.81 $26.39 $28.86 $31.41 Semiconductor Processors % % $14.45 $15.64 $17.29 $18.73 $20.25 CNC Machine Tool Programmers % % $22.02 $24.09 $26.86 $29.57 $32.34 TOTALS & AVERAGES 18, % 19, % $19.62 $21.38 $23.76 $26.04 $28.41 Source: Economic Research Institute & UHS Global Insights
10 Community Benchmark Analysis Variables & Weightings This analysis scores and ranks every MSA in NC, TX, OR, and VA, as well as a 90 mile radius around Marcy, NY, based on critical workforce characteristics. The model indexes each market based on the following variables & weightings. 10 LABOR AVAILABILITY 75% LABOR COST 25% LABOR SCALABILITY 30% LABOR COST 100% Population 20% Average Salary: Electrical Engineer 15% Labor Force 40% Average Wage: Electrical Engineering Tech 15% % Population Growth 15% Average Wage: Maintenance Mechanic 15% # of College Students 20% Average Wage: Machinist, General 15% Unemployment Rate 5% Cost of Living 20% OCCUPATION PRESENCE 35% Median Household Income 10% Total Engineering Occupation Cluster 12.5% Per Capita Income 10% % Engineering Occupation Cluster 12.5% Total Technicians Occupation Cluster 12.5% % Technicians Occupation Cluster 12.5% Total Maintenance Occupation Cluster 12.5% % Maintenance Occupation Cluster 12.5% Total Production Occupation Cluster 12.5% % Production Occupation Cluster 12.5% TARGET EDUCATIONAL ATTAINMENT 5% % High School Graduates (or GED) 45% % Some College, No Degree 5% % Associates Degree 30% % Bachelor's Degree 20% TARGET AGE GROUP 5% % Ages % % Ages % % Ages % % Ages % TARGET HOUSEHOLD INCOME DISTRIBUTION 5% % $0k to $34,999 20% % $35k to $49,999 30% % $50k to $74,999 50% COLLEGE COMPLETIONS 20% Engineering Completions 40% Technician Completions 40% Maintenance Completions 10% Production Completions 10% COMMUNITY BENCHMARK ANALYSIS METHODOLOGY All 65 MSA s with a population over 100,000 in the four competing states were included The model tiers each MSA by population Tier 1 = 1,000,000 + Tier 2 = 500, ,999 Tier 3 = 250, ,999 Tier 4 = 100, ,999 MSA s are only scored against others in its respective tier An index score in any category of is considered average
11 Results of Community Benchmark Analysis Average State Indexes vs. Marcy, NY The following indexes represent the average scores for every MSA within each respective state. A 90 Mile radius around Marcy, NY scores more favorably than each of the competing state averages. An index of 100.0% in any category is considered average. These indexes were calculated using the variables & weightings on the previous slide. Those in green are considered above average, while those in red represent the minimum score for any state in that particular category. Total Index Labor Availability Index Labor Cost Index Marcy, NY (90 Mile Radius) 108.8% 109.0% 108.2% North Carolina 89.5% 85.6% 101.3% Oregon 81.4% 76.7% 95.4% Texas 91.8% 88.1% 103.0% Virginia 93.0% 91.6% 97.3% 11 Source: Site Selection Group, LLC
12 Labor Availability vs. Labor Cost Graph North Carolina, Oregon, Texas, Virginia This following graph shows how Marcy, NY compares to each of the other 65 MSA s in the competing four states relative to labor availability and labor costs. Those MSA s in the green quadrant score above average in both categories. 125% McAllen Edinburg Mission, 120% El Paso, TX 115% Laredo, TX Marcy (90 Mile Radius), NY 110% Brownsville Harlingen, TX LABOR COST INDEX 105% 100% 95% Dunn, NC Albany Lebanon, OR Staunton Waynesboro, VA Greensboro High Point, NC College Station Bryan, TX Houston Sugar Land Baytown, TX Longview, TX Bend, OR 90% Winchester, VA WV Charlottesville, VA 85% 80% Washington Arlington Alexandria, DC VA MD WV 12 Source: Site Selection Group, LLC 75% 40% 50% 60% 70% 80% 90% 100% 110% 120% 130% 140% 150% 160% LABOR AVAILABILITY INDEX
13 Workforce Supply & Demand Model Summary Methodology SSG conducted a LaborCast Analysis which is a workforce supply & demand model that assesses the surplus/deficit of workers at specific wage rates in a given geography. The model projects out 10 years. The engineering occupation cluster assessed by the model includes the same occupation titles noted on slide 4. The geography used was a 90 mile radius from Marcy, NY. The model takes the following into consideration: Net occupation growth/decline year to year Current market wages for key occupations Year to year wage escalator Client attrition rates Competitor attrition rates Applicant to hire ratios The model provides the minimum wage that can be paid to hire the needed headcount for the target occupations. 13 Source: Site Selection Group, LLC
14 Workforce Supply & Demand Model Summary Engineering Occupation Cluster It would require a wage of $38.25 to hire 550 target engineers in year 1 That wage would last 10+ years in the market 14 Source: Site Selection Group, LLC
15 Key Regional Workforce Statistics Based on 90 Mile Radius from Marcy, NY The following tables show key regional workforce statistics. The data represents a 90 mile radius around Marcy, NY. LABOR AVAILABILITY Population: 2,910,070 Labor Force: 1,495,186 Unemployment Rate: 6.4% (July 2013) EDUCATION % H.S. Grad (GED): 32.10% % Associate s Degree: 11.25% % Bachelor s Degree: 15.11% College Enrollment 329,621 BUSINESS CONDITIONS State Corp. Inc. Tax: 5.90% SUTA New Employer Rate: 3.40% SUTA Wage Base: $8,500 AGE DEMOGRAPHICS Age 21 to % Age 25 to % Age 35 to % Age 55 to % INCOME STATISTICS Median HH Income: $49,888 Per Capita Income: $24,837 Average HH Income: $64,936 QUALITY OF LIFE Crime Index 22 Weather Risk 31 Cost of Living Index: Median Housing Value: $137,192 OCCUPATION CLUSTERS Engineering (2013/2018) 6,911 / 7,248 Technician (2013/2018) 2,613 / 2,710 Maintenance (2013/2018) 19,207 / 20,365 Production (2013/2018) 18,481 / 19,514 OCCUPATIONAL COMPOSITION Management Operations 8.78% Architecture & Engineering 1.96% Production 5.59% Transportation & Material Moving 5.62% Installation, Maintenance, & Repair 3.24% Bus. & Financial Operations 4.29% Computer & Mathematical 2.22% Blue Collar 19.14% White Collar 62.38% 15 Source: Claritas, ERI, UHS GI, BLS
16 REGIONAL WORKFORCE INTERVIEWS & QUALITATIVE ANALYSIS 16
17 Summary or Interviewees The following companies were surveyed based on their experience with the region s workforce. The objective of the survey was to assess general labor availability and labor quality as it relates to a large scale electronics production operation. Regional Employers Air Force Rome Research Lab Anaren Microwave, Inc. Assured Information Security, Inc. BAE Systems Binghamton BAE Systems Rome Bechtel Marine Propulsion Corporation Knolls Lab Bristol Myers Squibb ConMed Esterline Advanced Sensors GE Energy Indium Corporation International Wire ITT Exelis JH Rhodes Kionix, Inc. Lockheed Martin Owego Lockheed Martin Syracuse Partech, Inc. Raymond Corp Saab Sensis Corp Special Metals International Corporation Turbine Engine Components Technologies Utica Corporation UTC Aerospace Welch Allyn 17
18 Regional Employer Interview Scorecard General Labor Availability Measures Each employer interviewed answered the following questions on a 1 5 scale (1 = not favorable, 5 = very favorable). The scores in the table below represent the average of the responses. 18 GENERAL LABOR AVAILABILITY MEASURES SCORE Qualified applicant flow for available positions 3.60 Experience level of qualified applicants 3.70 Availability of experienced skilled workers 3.70 Availability of experienced Engineers 3.15 Availability of experienced management personnel 3.25 Availability of experienced machine and tool operators 3.55 Availability of experienced technicians 3.00 Availability of experienced administrative personnel (e.g. HR, Acctg, IT) 3.60 Availability of qualified entry level technicians (e.g. recent 2 yr grads/military separates) 3.85 Availability of qualified entry level engineers (recent 4 yr grads) 3.65 Availability of qualified entry level administrative employees 3.80 Availability of qualified support services vendors/personnel (e.g. piping, electrical, trades, gasses, envtl, HVAC) 3.90 Ability to hire 300+ qualified engineers 2.80 Ability to hire 400+ qualified technicians 3.30 Ability to hire 100+ qualified machine and tool operators 2.90 Ability to hire and retain qualified manufacturing employees at regional market wages and benefits 4.05 Ability of regional market to satisfy long term labor needs 4.40 Ability to relocate key personnel to region 3.15 Ability to attract/retain qualified employees from 60 mile radius 3.50 Ability to attract/retain qualified employees from 90 mile radius 3.45
19 Regional Employer Interview Scorecard General Labor Quality Measures Each employer interviewed answered the following questions on a 1 5 scale (1 = not favorable, 5 = very favorable). The scores in the table below represent the average of the responses. LABOR QUALITY MEASURES SCORE Employee turnover 4.35 Employee absenteeism 4.30 Ability to operate 24/7/ Ability to fill out and operate 2nd shift 4.00 Ability to fill out and operate 3rd shift 3.75 Ability to fill out weekend shifts 4.15 Willingness to work overtime 4.20 Availability of qualified temporary services 4.50 Ability operate without union organization 4.30 Ability of candidates to satisfy pre employment screening requirements 3.80 Educational attainment of applicants 4.00 Employee reading, writing and arithmetic skills 4.15 Critical Reasoning skills 4.15 Teamwork skills 4.15 Employee productivity 4.40 Employee reliability 4.90 Flexibility/adapt to change 3.75 Ability to understand and carry out work instructions promptly and accurately 4.00 Ability to understand and achieve goals and objectives 4.50 Employee overall work ethic
20 Regional Employer Interviews Anecdotal Data & Comments Labor Availability The Region has along standing manufacturing tradition with a very well educated workforce rich in manufacturing technology and operating skills at competitive prices. All employers confirmed their abilities to operate 24/7/365 (including shifts of 8, 10 and 12 hours), fill out all shifts with relative ease (including weekends) and satisfy overtime requirements. All employers interviewed affirmed the Region's capacity to supply the required numbers of entry level engineers, technicians, machine and tool operators and shared service administrators immediately and those with experience during the 3 5 year ramp up. All pointed to their confidence in the Region's long term labor supply. Labor Quality The Region's workers are well schooled in the importance of work ethic, basic skills mastery, teamwork, goal orientation, productivity and reliability. Preferred employers in the region conduct rigorous pre employment screenings that produce 3 4 qualified candidates for each available position. Education & Workforce System Entry level engineering and technical skills flow largely from engineering and technology programs at SUNY IT, RIT, RPI, Clarkson and Syracuse to a lesser extent. Employers recruit from Cornell (salary expectations are well above market), SUNY Albany, Worcester Polytechnic, Amherst, Western New England and numerous national sources. Manufacturing technicians and NC operating specialists upgrade and enhance their industrial skills through market proven, associate degree and certificate programs at regional institutions such as Mohawk Valley Community Colleges, Monroe, Herkimer, Hudson Valley, Schenectady, Onondaga, Oneida, North Country and numerous others. Workforce Solutions for the three county region served 10,000 people that were unemployed and/or underemployed Commuting Patterns Workers commute primarily across a 60 mile radius that extends from Binghamton to Watertown and Schenectady to Auburn & Syracuse. New York's highway system and current population concentrations facilitate the 60 mile commute radius and enable reaching out to 90 miles although that distance increases competition as it increases labor force. Additional employees reside in Albany, Troy, Saratoga Springs and Ithaca, although workers traveling from these areas tend to relocate to Mohawk Valley after 2 3 years tenure. Miscellaneous Industrial union activity is virtually non existent with those companies who are organized having operated with their current unions for 6 decades or more in the metals fabrication, service center, forging and related sectors. All employers emphasized the strength of the region's support service base and the high quality of temporary services that supply industrial workers. 20
21 21 APPENDIX
22 Appendix Definitions and Explanation of Analyses Workforce & Education Definitions Entry Level Jobs defined as the amount of annual available jobs to be filled by those entering the labor force after graduating from a post secondary education institution. The metric is calculated by multiplying the total number of workers in a particular category by the percent of jobs typically filled by entry level workers on an annual basis. The percentage is estimated through the intelligence gathered through employer interviews as well as O Net. Graduate Surplus equals the number of annual graduates in specific programs at various attainment levels less the number of corresponding entry level jobs. Community Benchmark Analysis Critical workforce data variables were pulled for all 65 metropolitan statistical areas with a population over 100,000 in the four benchmark states, as well as a 90 mile radius around Marcy, NY. Those variables are intended to provide a workforce availability and cost comparison, and include indicators that measure labor scalability, target age groups, income levels, education attainment, target occupations, post secondary education institution output, wages and salaries, cost of living, and household income. Each MSA is classified into one of four tiers based on population (tier 1 = 1,000,000+; tier 2 = 500, ,999; tier 3 = 250, ,999; tier 4 = 100, ,999). The statistics for each MSA are only scored against other MSA s in its respective tier. An index for each variable is created on a 0% 200% scale where 100% is considered to be tier average. Indexes for Labor Availability and Labor Cost are created utilizing the variables & weightings presented on slide 10. A Total Index is created with a weighting of 75% Labor Availability and 25% Labor Cost. Any index over 100% in any category is considered to be above tier average. Ideal communities will score above 100% in both Labor Availability and Labor Cost. Workforce Supply & Demand Analysis LaborCast SSG uses its proprietary workforce supply & demand model to identify the target wage needed to hire the projected engineering headcount in the first year. The model also project the supply of target engineers within a 90 mile radius of Marcy, NY over 10 years at that wage. The model is dynamic in the sense that one can adjust the headcounts and/or wage to see how market longevity is affected. The model takes into consideration net growth of the occupation cluster, labor force growth, current market wage structure, applicant to hire ratios, and estimated market attrition rates. 22
23 23 THEMATIC MAPPING
24 Table of Contents 2013 Population Density Population Growth 2013 Labor Force 2013 Labor Force Participation Rate 2013 Engineering Occupation Cluster Density 2013 Technician Occupation Cluster Density 2013 Maintenance Occupation Cluster Density 2013 Production Occupation Cluster Density 2018 Engineering Occupation Cluster Density 2018 Technician Occupation Cluster Density 2018 Maintenance Occupation Cluster Density 2018 Production Occupation Cluster Density 24
25 Demographic Trend Maps 2013 POPULATION DENSITY 90 Mile Radius 25
26 Demographic Trend Maps POPULATION GROWTH 90 Mile Radius 26
27 Demographic Trend Maps 2013 LABOR FORCE 90 Mile Radius 27
28 Demographic Trend Maps 2013 LABOR FORCE PARTICIPATION RATE 90 Mile Radius 28
29 Demographic Trend Maps 2013 ENGINEERING OCCUPATION CLUSTER DENSITY 90 Mile Radius 29
30 Demographic Trend Maps 2013 TECHNICIAN OCCUPATION CLUSTER DENSITY 90 Mile Radius 30
31 Demographic Trend Maps 2013 MAINTENANCE OCCUPATION CLUSTER DENSITY 90 Mile Radius 31
32 Demographic Trend Maps 2013 PRODUCTION OCCUPATION CLUSTER DENSITY 90 Mile Radius 32
33 Demographic Trend Maps 2018 ENGINEERING OCCUPATION CLUSTER DENSITY 90 Mile Radius 33
34 Demographic Trend Maps 2018 TECHNICIAN OCCUPATION CLUSTER DENSITY 90 Mile Radius 34
35 Demographic Trend Maps 2018 MAINTENANCE OCCUPATION CLUSTER DENSITY 90 Mile Radius 35
36 Demographic Trend Maps 2018 PRODUCTION OCCUPATION CLUSTER DENSITY 90 Mile Radius 36
37 For additional information contact: Site Selection Group, LLC 8300 Douglas Avenue Suite 700 Dallas, TX (214)
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