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Manufacturing and high paying jobs shrink in greater Minnesota
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For nearly three decades John Schell worked at Harsco Track Technologies in Fairmont. When his job was cut last May he was among the plant's highest wage earners. (MPR Photo/Erin Galbally)
Small towns across greater Minnesota cashed in on a boom in high-paying manufacturing jobs gained in the years between 1991 and 2000. But the manufacturing sector has been hit the hardest in Minnesota by the recession. Most of the 46,000 manufacturing jobs the state gained during the prosperous years of the 1990s have disappeared. For workers in out-state Minnesota and their communities the loss can be devastating.

Fairmont, Minn. — For nearly three decades John Schell worked at Harsco Track Technologies in Fairmont. The company makes railroad maintenance equipment, like rail grinders and spike drivers.

His hair in a ponytail, Schell is sipping coffee in a favorite lunch spot on the edge of this south central Minnesota town. Schell says he grew up working for Harsco.

"I came from a Ford garage as a parts man so I never knew how to weld or use a punch press but you usually just start in but mostly you learn as you went," Schell explains. "That's the training."

The manufacturing jobs at Harsco are important to Fairmont. It was the town's leading employer less than a decade ago. But after a series of layoffs and cutbacks, the plant is threatened with closure.

Schell's situation is typical when out state communities lose manufacturing jobs.

When his job was cut last May he was among the plant's highest wage earners. The search for his next job took him to other industries and other towns, without luck.

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Image Jim Zarling is not optimistic.

"County maintenance job, meter reader," Schell ticks off a list. "I applied for a forklift operator over in Jackson at Pioneer see and I applied at Cargill in Blue Earth."

But all of those openings were flooded with applicants. Schell says he couldn't even find farm work. By October, he was desperate, and he eagerly accepted a much lower-paying job at another Fairmont factory.

"I am making now just under 40 percent of what I was making at Harsco Track Technologies. I just checked today, starting wages," says Schell.

Despite the pay cut Schell says he's just grateful to have a job. But he's looking for second and third jobs in order to make the bills.

Connie Noble-Walters says high paying manufacturing jobs are hard to find in the area. Noble-Walters helps displaced workers find new work at Fairmont's workforce center. She says these days manufacturing accounts for the vast majority of local job losses.

"Of the people unemployed, very heavy in manufacturing. I'd say off the top off my head 80 to 90 percent," says Noble-Walters.

During the 1990s manufacturing was one of the bright spots in Minnesota's economy. The state gained 46,000 manufacturing jobs. But since 2000, 80 percent of those jobs have disappeared.

Jay Mousa, the research director for the Minnesota Department of Economic Security, which tracks employment in the state, says greater Minnesota has been losing jobs at roughly the same rate as the Twin Cities, but the effect is different outstate.

"The thing is manufacturing losses in greater Minnesota have serious impact on local economy and in many cases these are some of the few jobs that pay relatively high wages. So a loss of these jobs means more for the local economy then the Twin Cities," he explains. Mousa says the bleeding has stopped, manufacturing job cuts have slowed, but no one is hiring.

"The environment that will make employers step up to the plate and hire workers is not there yet. We still have a lot of uncertainty with Wall Street, with war with Iraq, with the war on terrorism," says Mousa.

Over the years manufacturing has been an important economic force in greater Minnesota explains State economist Tom Stinson.

"One of the strengths of Minnesota's economy outside the Twin Cities has been increasing manufacturing employment," says Stinson. "Not all of that manufacturing employment has been for primary workers. One of the advantages Minnesota had was they had a supply of farm wives that were looking for work and were good workers in manual assembly."

Stinson says plant closings and job losses in one community can have a broad impact.

"While the closure of a factory or a loss of manufacturing jobs in a particular community will affect that community, its also likely to affect a whole range of communities spread 50 or 60 miles away because people are commuting from their homes in other places to the place they're working," says Stinson.

In Fairmont, City Manager Jim Zarling is not optimistic about local manufacturing. A plant closing expected in March will eliminate the jobs of roughly 60 more workers.

Zarling says there's often little the city can do to help struggling manufacturers.

"If its an issue of their taxes are too high or their utilities are too high than we can take a look at incentives but if the problem is just that they're manufacturing more than they're just manufacturing more than they're selling, we really can't do anything about it," says Zarling.

With manufacturing in decline, city officials like Zarling are pinning their hopes on the rising health care sector. It recently replaced manufacturing as Fairmont's biggest employer. On an average day the local hospital has about 20 job openings. Plans are underway to open a nursing school.

Zarling says he hopes a reputation for medical care will transform Fairmont from a manufacturing center into a popular retirement spot. But he says some resist the change.

"Well young people will say we don't want this to be a retirement community but they forget the more people you have coming into the community to retire here means they need more services and not just health care," Zarling explains. "They'll need retail and all of those things and we think that's a plus for us."

Even though John Schell just started a new job, he's contemplating leaving the community. Possibly moving out west to Wyoming or Colorado. He thought about nursing school but decided it wasn't for him.

At the workforce center, Connie Noble-Walters says she hopes many displaced manufacturing workers will make the change to health care. That way they can stay in Fairmont. But Noble-Walters says change is inevitable as the city's manufacturing sector shrinks.

"So granted we'll loose some of these workers. They'll try to move to a job somewhere. They'll relocate but we'll have others move in. It will be a different look," says Noble-Walters.

But that economic shift will likely come at a loss. Local health care wages are higher than average, but not as high as manufacturing. Martin County health care wages registered close to 16 percent less than those earned in manufacturing. That means laid off factory workers who make the switch may not be able to avoid a pay cut.

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