As we get into the thick of 2024, the tension and nerves around the economy continue to be high. We’re seeing national headlines about layoffs measured in the tens of thousands. We’re hearing rumors of interest rate cuts and seeing consumer spending and inflation still higher than expected. The median home price in all Central Oregon communities remains high, and efforts to deliver more middle and/or workforce housing cannot come fast enough or in large enough volumes to make a material impact in 2024. The efforts and advocacy work to address this critical component are appreciated though.
The cost of home ownership continues to rise in Central Oregon despite efforts to curb this trend. It’s hard to develop confidence and make informed decisions in this type of environment when the traditional markers are mismatched from expectations.
At G.A. Rogers and Associates we work closely with local businesses and the workforce, and are encouraged with all things employment-related. We are seeing organizations invest in their employees in effort to retain the talent they’ve worked so hard to acquire, and also develop this demographic group into the next tier of leaders.
This is a short piece on what we are seeing in the local workforce…
Local employment headcount by industry, via BLS:
- Mining, Logging and Construction: 10,344
- Trade, Transportation and Utilities: 18,912
- Financial Activities: 6,504
- Education and Health Services: 18,894
- Professional Business Services: 14,016
- Leisure and Hospitality: 17,160
- Government: 11,280
- Manufacturing: 7,416
- Information: 2,232
- Other Services: 3,840
The workforce in Central Oregon is made up of five generations:
- Silent G: 2,000 (~2%)
- Boomers: 27,000 (~23%)
- Gen X: 37,000 (~31%)
- Millennial: 42,000 (~35%)
- Gen Z: 11,000 (~9%)
In 2024 (and beyond) Silent Gs and Boomers will continue trending towards retirement and Gen Z will enter the workforce in higher volume. As a result, there is a big culture shift that every company will need to prepare for. Gs and Zs are about as different as possible and that shows up in many ways. The methods to recruit and retain across generations, for example, are very different. Perks that people want and care about are different across generations. The challenges around managing the workforce will shift as the generational makeup changes.
As the workforce demographics shift, other challenges include:
- Who will take on outgoing leaders’ responsibilities? We’ve seen a number of leadership changeovers early in the year already with local nonprofits and private businesses. Replacing someone is not easy and how that is handled is unique to the organization.
- The competition for talent. How will you recruit and retain top contributors? With unemployment at 3.7% and the cost of living in Bend specifically being prohibitive to the younger workforce, parents + the increase in costs to run a business in Bend, competing will be hard. Expanding to additional markets, increasing prices, or outsourcing administrative tasks will remain a priority.
- Can your current team weather economic uncertainty? Capex projects that rely on interest rates, tax breaks, economic policies, or government funding could get delayed. What happens to cash flow if that is the case?
- How will AI impact your business? The proliferation of fake job posts, fake resumes, texting-based scams and completely fraudulent companies is a risk we all have to navigate each day.
The remote work boom is starting to wane in 2024. Companies that were not specifically built to be remote first are calling people back into the office (see Nike, Amazon, Zoom, etc.) at least part-time. High-paying remote jobs are not easily replaced by joining local companies which creates another hard choice; stay here, or go back to the city that houses the employer. Demands for increased compensation in Central Oregon will continue in 2024, although not as rapidly as in the previous two years.
In 2024, we expect to see the workforce in Central Oregon continue to grow by 1-1.5%. We expect to see more demands from employees on businesses for auxiliary benefits from Volunteer Time Off, Mental Health Benefits, and Housing Stipends. The number of people hired from outside the area who relocate to work in Bend will be lower this year than in years past. People will continue to move here, though those that do are often 55+ and not looking for full-time work when they move, which further complicates the dynamics of our workforce by placing demand on services without supplying local contributions.
Hiring in 2024 will start off with a rush. The number of business closures in recent months has increased the number of job seekers on the market by a noticeable amount (Indeed and LinkedIn activity is up significantly early in the year). As we get into the year though, turnover will continue to follow normal trends, niche/technical roles will continue to be hard to hire, and leadership positions will continue to require a precise strategy in hiring.
In summary, now is the time to invest in retaining the workforce that organizations have acquired and ensuring the leadership team is prepared to address continued uncertainty in the economy. Capitalize on projects that are approved and keep building the pipeline for future revenue.
