Making You Feel at Home

by Cameron Macht
December 2013

Making You Feel At Home

Real estate agents say that a house feels empty until there is furniture in it, and then it feels more like a home, making it easier to sell. Central Minnesota is home to more than one-fourth of the state’s employment in furniture and related product manufacturing, including one-third of the state’s jobs in kitchen cabinet manufacturing.

Through 2012 the 13-county Central Minnesota planning region was home to 122 Furniture and Related Product Manufacturing establishments, providing 2,285 covered jobs and just under $94 million in total payroll. The largest segment in the region is Household and Institutional Furniture and Kitchen Cabinet Manufacturing, which provided 1,897 jobs at 108 firms with a payroll of $74.4 million. The region also has a small but significant concentration of employment in Office Furniture Manufacturing, offering 388 jobs at 14 firms (Table 1).


Table 1

Central Minnesota Industry Employment Statistics, 2012

NAICS Industry Title

NAICS Code

2012 Annual Data

Number of Firms

Number of Jobs

Percent of Statewide Jobs

Total Payroll

Average Annual Wages

Total, All Industries

0

17,479

254,123

9.6%

$9,270,803,237

$36,452

Furniture and Related Product Manufacturing

337

122

2,285

26.5%

$93,647,713

$40,976

Household and Institutional Furniture and Kitchen Cabinet
Manufacturing

3371

108

1,897

34.2%

$74,410,703

$39,208

Office Furniture (including Fixtures) Manufacturing

3372

14

388

15.2%

$19,237,010

$49,556

Source: DEED Quarterly Census of Employment & Wages (QCEW) program



Couldn’t Stand the Heat

In the first half of the last decade demand for furniture and kitchen cabinets heated up along with the red-hot housing market, especially in Central Minnesota. From 2002 to 2006 total employment in kitchen cabinet manufacturing grew twice as fast in Central Minnesota (+23.4%) as in the state of Minnesota as a whole (+12.4%), with the Central region accounting for 38 percent of statewide employment at the high point of the industry in 2006.

But as the housing market cooled off, the craving for kitchen cabinets also went cold. From the peak in 2006 to the trough in 2010, Central Minnesota sliced more than 56 percent of its jobs in Household Furniture and Kitchen Cabinet Manufacturing, while the state lost 41.2 percent. Office furniture manufacturers rolled back more than one-third of their jobs in the state (-33.7%) and one-fourth of the jobs in the region (-27.7%).

As the housing industry has recovered and building has restarted, Kitchen Cabinet Manufacturing has started to simmer again. Jobs in Central Minnesota jumped 27.4 percent from 2010 to 2012, which was more than five times as fast as the state as a whole, which gained 4.8 percent (Figure 1).


Figure 1


Restocking the Cupboards

Despite the recent gains, the Household and Institutional Furniture and Kitchen Cabinet Manufacturing sector still has only two-thirds of the jobs it started with in 2002 and would need to add almost 1,500 more jobs to get back to the employment peak reached in 2006. That would require several years of unprecedented growth — the region gained less than half that many jobs from 2002 to 2006 — and simply may never be attained again.

However, the sector has already outperformed DEED’s Employment Projections for the next decade. According to DEED’s industry projections, the Household and Institutional Furniture and Kitchen Cabinet Manufacturing sector was expected to grow from 1,490 jobs in 2010 to 1,730 jobs in 2020, but as shown above, was already closing in on 1,900 jobs in 2012. If the sector keeps adding jobs at the current rate — just over 200 net new jobs per year — it would surpass the previous record in 2019.

Job growth in Office Furniture Manufacturing was much more measured in the last two years, increasing by just 1 percent in Central Minnesota and 6.2 percent statewide. But the Office Furniture Manufacturing sector is expected to see much faster growth in the next decade, expanding as much as 40 percent through 2020, which would bring it back to the previous employment peak.

Long term, the fate of the industry is closely tied to the housing market, so more ups and downs are likely on the way. Job growth may heat up again as people start moving and building new houses or remodeling their kitchens, or employment may level off or drop again if they stay in place (Table 2).


Table 2

Central Minnesota Industry Employment Projections, 2010 to 2020

NAICS Industry Title

NAICS Code

Estimated Employment 2010

Projected Employment 2020

Percent Change 2010 - 2020

Numeric Change 2010 - 2020

Total, All Industries

0

281,615

333,237

+18.3%

+51,622

Furniture and Related Product Manufacturing

337

1,875

2,270

+21.1%

+395

Household and Institutional Furniture and Kitchen Cabinet Manufacturing

3371

1,490

1,730

+16.1%

+240

Office Furniture (including Fixtures) Manufacturing

3372

385

540

+40.3%

+155

Source: DEED 2010 to 2020 Employment Projections

 

Good Things Come in Small Packages

Not surprisingly, many Household and Institutional Furniture and Kitchen Cabinet manufacturers responded to the downturn by downsizing their operations. In 2006 there were an average of 26 employees at each of the 133 Household and Institutional Furniture and Kitchen Cabinet Manufacturing establishments in Central Minnesota and 30 employees at each of the 18 Office Furniture Manufacturers. By 2010 the average firm had downsized to 14 and 24 employees, respectively, while the number of firms dropped to 107 and 14, respectively.

Most of the remaining furniture manufacturers are small businesses, including 83.3 percent that have less than 20 employees, and 53.9 percent that had between one and four employees. Instead, only four furniture manufacturers in the region had 100 or more employees, with three of those building kitchen cabinets and the other building office furniture (Figure 2).


Figure 2


Measure Twice, Cut Once

Fortunately, the remaining employees are accustomed to the cutting, having been trained to cut, saw, and finish furniture and cabinets. Job seekers may be interested because many of the jobs still available in the sector require a high school diploma or less and short- to moderate-term on-the-job training, yet pay above average wages and have above average growth rates.

More than half of the top occupations in demand are projected to grow faster than average in Central Minnesota, including the five occupations most closely tied to the industry: upholsterers, sawing machine operators, woodworking machine operators, carpenters, and cabinetmakers and bench carpenters.

As an example, cabinetmakers and bench carpenters earn a median hourly wage of $16.86 in Central Minnesota, compared to $16.14 for the total of all occupations, and are expected to grow 31.5 percent from 2010 to 2020, which is 13 percent faster than the total of all occupations. Entry-level cabinetmakers and bench carpenters typically need a high school diploma or equivalent, as well as three months to one year of on-the-job training.

Nine of the top 10 occupations in demand in both the Household and Institutional Furniture and Kitchen Cabinet Manufacturing sector and the Office Furniture Manufacturing sector can be gained with a high school diploma or less, with the lone exception being first-line supervisors of production workers, which often also require some sort of postsecondary non-degree award as well as related work experience (Table 3).

Table 3

Occupations in Demand in Furniture and Related Product Manufacturing in Central Minnesota

Occupational Title

Median Hourly Wage

Estimated Regional Employment 2010

Projected Regional Employment 2020

Percent Change 2010 - 2020

Numeric Change 2010 - 2020

2010 - 2020 Replacement Openings*

Education Requirements

On-the-job Training Requirements

Total, All Occupations

$16.14

281,615

333,237

+18.3%

+51,622

+66,890

Cabinetmakers and Bench Carpenters

$16.86

482

634

+31.5%

+152

+120

High school diploma or equivalent

Moderate term on-the-job training

Assemblers and Fabricators, All Other

$13.23

1,304

1,711

+31.2%

+407

+260

High school diploma or equivalent

Moderate term on-the-job training

Carpenters

$20.90

2,107

2,745

+30.3%

+638

+450

High school diploma or equivalent

Apprenticeship

Welders, Cutters, Solderers, and Brazers

$17.90

1,276

1,648

+29.2%

+372

+340

High school diploma or equivalent

Moderate term on-the-job training

Woodworking Machine Operators

$13.99

316

393

+24.4%

+77

+30

High school diploma or equivalent

Short term on-the-job training

Sawing Machine Operators

$16.04

163

201

+23.3%

+38

+40

High school diploma or equivalent

Short term on the job training

Laborers and Freight, Stock, and Material Movers, Hand

$12.09

2,960

3,602

+21.7%

+642

+950

Less than high school

Short term on-the-job training

Upholsterers

$14.56

96

116

+20.8%

+20

+20

High school diploma or equivalent

Moderate term on-the-job training

Sales Representatives, Wholesale and Manufacturing

$26.96

2,228

2,612

+17.2%

+384

+520

High school diploma or equivalent

Moderate term on-the-job training

Furniture Finishers

$8.83

39

45

+15.4%

+6

+10

Industrial Truck and Tractor Operators

$16.99

842

970

+15.2%

+128

+240

Less than high school

Short term on-the-job training

Helpers-Production Workers

$11.00

784

893

+13.9%

+109

+130

Less than high school

Short term on-the-job training

First-Line Supervisors of Production Workers

$24.97

1,650

1,863

+12.9%

+213

+220

Postsecondary non-degree award

None

Cutting, Punching, and Press Machine Operators

$14.44

909

1,026

+12.9%

+117

+70

High school diploma or equivalent

Moderate term on-the-job training

Team Assemblers

$14.71

2,066

2,300

+11.3%

+234

+410

High school diploma or equivalent

Moderate term on-the-job training

Shipping, Receiving, and Traffic Clerks

$14.91

1,210

1,311

+8.3%

+101

+310

High school diploma or equivalent

Moderate term on-the-job training

Sewing Machine Operators

$10.75

139

143

+2.9%

+4

+10

Less than high school

Short term on-the-job training

Source: Bureau of Labor Statistics, DEED Occupational Employment & Wage Statistics (OES), DEED 2010-2020 Employment Projections

 

Cutting Class

A high school education and one year of training can get a worker in the door, but new technology and more sophisticated machinery require workers to continue with their training. Becoming a skilled woodworker often takes three or more years, with workers needing to read blueprints, set up machines, and plan work sequences.

According to the Bureau of Labor Statistics’ Occupational Outlook Handbook, “people seeking woodworking jobs can enhance their employment and advancement prospects by completing high school and getting training in computer applications and math.”1 

“Skill with computers and computer-controlled machinery is increasingly important. Those who have advanced skills, including in mathematics and computers, should have the best job opportunities in manufacturing industries.”2

Job analysis shows that some woodworkers further their education at technical schools or community colleges, while others attend postsecondary training in wood technology, furniture manufacturing, wood engineering, and production management, all of which become more important as woodworking technology advances.



1Woodworkers. www.bls.gov/ooh/production/woodworkers.htm
2Woodworkers. www.bls.gov/ooh/production/woodworkers.htm