Maine manufacturing jobs plummet even as workforce becomes more educated

Posted Sept. 02, 2012, at 11:54 a.m.
Last modified Sept. 05, 2012, at 6:46 p.m.
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Eric Zelz | BDN
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Althea Leach of Union recalls working at the Nautica manufacturing plant in Rockland where high-quality clothing such as jackets and robes were produced by hundreds of local workers and sold across the world.

“They were excellent jobs. They paid well and provided benefits,” Leach said.

Leach served as president and chief steward of the labor union that represented the workers at the plant, which had operated in Rockland for 63 years before closing its doors in 2002. Leach had worked there for 29 years.

The loss of manufacturing jobs has been a trend not only in Rockland and Maine but across the country as production is shifted to countries where labor and other costs are far less.

The loss of manufacturing jobs has resulted in the dwindling of the middle class. Job losses accelerated with the Great Recession that started in 2007.

Glenn Mills, director of economic research for the Maine Center for Workforce Research and Information, said there has been a growing divide as good-paying production and administrative support jobs that used to be filled by workers with less education have been lost.

He said education and retraining are needed to bridge the growing gap between well-paying and low-paying positions.

The number of overall jobs in the state declined from 602,737 in 2007 to 579,681 in 2011, a drop of just under four percent.

Manufacturing jobs, however, fell by twice that rate — 14 percent from 59,313 to 50,768, according to statistics from the Maine Center for Workforce Research and Information.

Manufacturing jobs tend to pay more money. The average pay for a manufacturing job in Maine has continued to rise despite the recession, going from $44,538 to $50,327 during the same period. The average wage for all jobs in the state went from $35,126 to $38,024 during that same period, according to state figures.

Paper mill jobs, for example, were a great source of good-paying jobs for the noncollege population, he noted. As those jobs declined, these workers were not able to find jobs that pay comparable wages.

The decline in manufacturing jobs, however, began well before the most recent economic downturn. The state Labor Department noted that manufacturing jobs accounted for 43 percent of all jobs 60 years ago, while today only 8.5 percent of jobs in Maine are manufacturing. That trend is expected to continue.

“Now, and for the foreseeable future, manufacturers will be subject to foreign competition and technology-driven job and industry restructuring. Moreover, the pace of change will likely increase,” according to the July Labor Department report titled “Manufacturing Jobs: Trends, Issues, and Outlook.”

The Rockland area is a microcosm of the state and national shift. In 1980, nearly one out of three jobs in the Rockland area were manufacturing jobs. Last year, that had plummeted to one out of every 11 jobs.

The decline was swift in the Rockland area.

Holmes Packing Co. closed its Rockland sardine plant in 1981. That property is now the site of a restaurant and marina. North Lubec Manufacturing closed its sardine plant in Rockland in 1984. That property is now an office building. Nearby National Sea Products closed its fish packing plant in 1990 with the loss of more than 200 jobs, and is now also used for offices.

The area’s last sardine plant — Port Clyde Packing Co. in Rockland — closed in 1997 and is now a boat repair facility.

Schoolhouse Togs employed more than 30 workers making children’s clothing in Rockland until 1992, when the plant was shuttered. At the time of the closing, the plant manager noted the company could not compete with plants in Taiwan, Korea, Sri Lanka and the Dominican Republic. That building is now occupied by Hamilton Marine.

And there was Nautica.

In 1937, a group of Rockland-area business leaders got together and attracted an apparel manufacturing company to locate in Rockland. A four-story wooden building was constructed on Route 1 in Rockland and hundreds of workers were hired to produce garments.

The company stopped manufacturing in Rockland in 1990 but continued to operate its distribution center in Rockland, employing more than 300 workers until 2002 when it relocated to a plant in Martinsville, Va. After 1990, Nautica apparel was being produced in countries such as Madagascar and Sri Lanka where wages were significantly lower.

Workers at the Nautica plant were being paid more than $11 an hour in 2002 and the company provided full health benefits for the workers and their children, with employee contributions for spouses.

Leach said she keeps up with some of her former co-workers and many have to work multiple jobs, most in retail or custodial jobs that pay much less and with far fewer benefits.

Immediately after she lost her job at Nautica, Leach worked for about nine months at the local Career Center to help displaced workers find training for new jobs. Some of the other people from Nautica received training to become certified nursing assistants.

The job at the Career Center, however, ended after nine months and she spent her time after that volunteering at her daughter-in-law’s child care center.

Leach said she is concerned about the loss of the manufacturing jobs in the country.

“It’s really a shame,” Leach said on this Labor Day weekend. “There are so many kids who can’t go to college or don’t want to go to college.

She said the cost of college is so great that young people struggle to pay for that education and then worry about whether there will be a job that pays a good wage and benefits.

The former Nautica manufacturing plant is today the Breakwater Marketplace, which has several tenants including the Rockland Career Center.

At the Career Center in Rockland, employment specialist David Grima said that there is a new focus within the organization statewide. Instead of laid-off workers coming in and being trained for careers they want, the agency will try to match up workers to the needs of employers.

In the state report on manufacturing, Labor Commissioner Robert Winglass emphasized that point.

“Businesses over the last few decades didn’t always need more workers; instead they needed workers who could operate computers and understand technology. Those skills remain important now,” Winglass stated in the report, adding that both the Labor Department and Maine Department of Economic and Community Development were working to address those issues.

The manufacturing workforce is becoming more educated. The Labor Department report on manufacturing noted that much of the growth in output at production plants in the state was due to process improvements and new technologies which offset the reduction in workers.

Between 1990 and 2010, information from the U.S. Census found that the number of manufacturing workers with some college education rose from a third to a half.

On the reverse side, professional and technical jobs have increased, according to the state Labor Department. MIlls said this has led to a divide between workers with higher education and those workers with less education. A recent report by the Labor Department noted that the unemployment rate for Mainers with less than a high school diploma has risen from 7.6 percent to 15.4 percent since the recession began. For workers with a bachelor’s degree or more education the jobless rate rose from 2.4 percent to 3.4 percent.

One specific area of employment that has seen an increase in jobs has been in health care and social services. Those jobs statewide increased 3 percent during the same period from 96,674 to 99,451. The average pay for those jobs is $40,554.

Grima said there is a shortage of trained workers in health care.

“It’s almost an unmeetable need,” he said of the demand of health care workers and the available workforce.

He noted a $4 million grant statewide is speeding up the training for higher level nurses.

“We want to address the shortage before it becomes a crisis,” he noted, as demand for health care is on the rise with an aging population.

The Labor Department projects that through 2018, the greatest percentage growth in jobs will be computer and mathematical ones. The number of those jobs is projected to increase nearly 13 percent. Those jobs will pay an average of $35.04 per hour. The other area of growth is personal care and personal service positions, which are projected to increase 11 percent. The pay for these jobs will average $11.37. Production jobs are estimated to decline by another 6 percent.

Other job trends

A further review of the changes in employment in Maine shows the following changes in employment and pay for jobs in Maine from 2007 through 2011.

• Construction jobs fell 19 percent from 30,964 to 25,202 from 2007 to 2011.

• Retail service jobs declined from 87,902 to 81,127, a drop of nearly 8 percent. The pay in these jobs rose 4 percent in that period from $23,139 on average to $24,187.

• The leisure and hospitality industry, where many jobs are seasonal, saw little change in the overall number of jobs, 60,337 to 60,157. The pay rose from $15,722 to $16,880.

• Jobs in the financial industry slipped by nearly 6 percent from 31,986 to 30,222. The average pay for workers in this industry rose 12 percent from $48,112 to $54,032. The financial industry includes insurance and real estate employees.

• Professional and business service jobs increased nearly 7 percent from 53,795 workers in 2007 to 57,345 workers in 2011. The average pay for these jobs — which includes legal, architectural, engineering, accounting and advertising — rose from $42,842 to $46,128.

• Government jobs declined since the recession began, falling a little more than 2 percent from 99,815 to 97,370. That included local government jobs, which dropped from 61,198 to 58,986, and state jobs, which decreased from 24,496 to 23,739. The number of federal government jobs rose from 14,121 to 14,644.

The average pay of all government jobs in Maine rose from $38,453 to $41,147. Local government jobs saw wages rise 10 percent from $31,773 to $34,985. State government jobs saw pay decrease less than 1 percent from $41,076 to $40,876. Federal employees saw their average wages in Maine rise nearly 6 percent from $62,854 to $66,408.

The review of employment figures also points out a continued gap between pay in different geographic areas of Maine.

Sagadahoc County had the highest average annual wage for Maine counties in 2011 at $43,994. Bath Iron Works is located in this county. Cumberland County came in second with an average annual wage of $43,051.

The lowest average annual wage was found in Piscataquis County at $29,642.

CORRECTION:

An earlier version of this story contained an error. A typo made the 2011 total employment figure incorrect as well as the net job loss since 2007. The correct number of jobs was 579,681, not 559,681, making the net job loss just under four percent, not seven percent.

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