, Gloucester, MA

November 5, 2012

Stats show city gains in low paying jobs

By Steven Fletcher Staff Writer
Gloucester Daily Times

---- — Statistics from the state’s Department of Labor and Workforce Development show Gloucester’s economy is gaining jobs, but the same figures also show the rebound is creating far more lower-paying jobs than anything else.

The numbers from the department and the North Shore Workforce Investment Board (WIB) show that the city’s economy has reached employment levels of where it was in 2007, before the worst of the recession. In the years following, Gloucester shed higher-paying manufacturing jobs and lower-paying retail and food service work filled the gap.

While wages and employment are higher than they were in the last few years, Gloucester’s unemployment rate hit 6.5 percent in September. While the rate rose from the August figure of 6.1, it’s still lower than the unemployment rate in September 2011. And Chamber of Commerce President Robert Heidt said the increase was largely caused by a loss of seasonal jobs.

In 2007, manufacturing companies — identified in the state statistics as durable goods manufacturing companies —employed the largest segment of Gloucester’s workforce. They still do, just by a much smaller margin.

An average 2,800 people worked in Gloucester manufacturing companies, according to an average monthly employment spreadsheet from the WIB. But in 2011, according to year-long tracking data, that average had fallen to 2,350, meaning that, over five years, Gloucester lost 420 manufacturing jobs, a 15 percent decrease.

Over those five years, meanwhile, retail jobs have grown in the city by almost 30 percent — or 365 jobs — according to the WIB. An average of 1,592 people worked in Gloucester retail stores in 2011, while accommodations and food service jobs rose by 20 percent over the last five years, adding 214 jobs.

“We’ve almost reached the 2007 (employment) levels,” said Peter Webber, senior vice president at the Cape Ann Chamber of Commerce, “but within that, the numbers have shifted. There’s been a shift from manufacturing into retail and accommodations, or broadly defined, the tourism sector.”

The overall growth in retail and accommodations companies, said Webber, matches what the Chamber of Commerce has seen on the ground. Webber said that, while the jump includes the stores in Gloucester Crossing, which opened in 2009, the chamber has see new stores open in Gloucester’s downtown this year. Between 2010 and 2011, retail growth slowed to roughly 3 percent.

In the same time period, the WIB data also shows local manufacturing jobs growing by 10 percent, adding 208 positions. Webber noted that those gains have come as two of the city’s largest manufacturing companies — the Varian Semiconductor Division of Applied Materials, and Gloucester Engineering — landed large-scale contracts.

“They were able to do some hiring because they build their business back up with significant contracts,” Webber said.

Bomco, a metal forming company, has also added jobs over the last year, and significantly expanded its plant along Gloucester Avenue.

But retail and other tourism related growth, said Webber, has overtaken gains in manufacturing. While growth in those areas is good to see, Webber said, the jobs retail creates don’t match the pay of the manufacturing jobs they replaced.

Of Gloucester’s four largest industry sectors — manufacturing, health services, retail and accommodations — manufacturing jobs, like ones in Bomco, Varian and Gloucester Engineering pay the highest wages.

The wage, said Will Sinatra, the WIB’s data analyst, is an average. It takes into account everyone from line workers to the executives. And on average, workers in Gloucester’s manufacturing companies made $3,513 a week in 2011. That’s up from $1,700 in 2008, a 64 percent increase.

But the average for retail workers was roughly $490 a week in 2011, down from $548 in 2007 and an 11 percent decrease.

“What you get back in retail aren’t necessarily the same paying jobs,” said Sinatra.

Wages in the health care field also rose from a 2007 weekly average of $769 to a 2011 weekly average of $888. Health care and social assistance industries employed an average 1,236 workers in 2011, down from 1,381 in 2007.

Wages in accommodations and food services fell from an average weekly wage of $332 in 2007 to an average wage of $327 in 2011.

The city’s fishing industry saw a continued decline in average monthly employment, falling to a yearly average of 133 people in 2011 from 151 in 2007. Yet, wages in the industry rose from an average weekly wage of $884 in 2007 to an average of $1,189 in 2011, the statistics show.

On the whole, Sinatra said, the average wage in Gloucester has gone up between 2007 and 2011, from $996 to $1,189.

The jobs in demand aren’t manufacturing jobs, either, labor statistics show.

The Department of Workforce and Labor Development lists the top five occupational vacancies as retail salespeople, cashiers, waiters and waitresses, registered nurses and food preparation workers, as of May 201. But, aside from registered nurses, none of those positions saw a median salary beyond $23,000.

Steven Fletcher may be contacted at 1-978-283-7000 x3455, or Follow him on Twitter at @stevengdt.