Looking for a job in 2021? These industries are likely to recover, decline in Wichita
As COVID-19 crushed the Wichita area’s economy in 2020, jobs in aviation manufacturing and the service sector were hit hard. But in 2021, leisure and hospitality jobs are expected to make a big comeback in the region, alongside other service jobs.
That’s according to 2021 employment forecasts from Wichita State University’s Center for Economic Development and Business Research. The predictions were first developed in October and revised for January.
However, the growth in the leisure and hospitality sector still won’t bring its jobs close to the pre-COVID peak, said Jeremy Hill, director of the WSU Center.
“Although there’s large growth, it’s not where we were before at all,” he said.
The job projections come after a tumultuous year for the economy induced by the spread of COVID-19. In Wichita, the one-two punch of the global grounding of the 737 Max airplane — on which Spirit AeroSystems workers build the structure — followed by the coronavirus made for unique economic difficulties.
In 2019, before COVID-19 hit, the Wichita area had a 20-year low unemployment rate. That quickly changed by April 2020 when the region’s unemployment grew to even greater heights than its peak in the 2009 recession.
Kansas jobs as a whole faced similar fluctuations. In 2019, the statewide unemployment rate was at its lowest since 1978, according to WSU’s analysis. By the second quarter of 2020, Kansas saw the single largest one-quarter contraction in state history.
And while local economists expect a slow but steady recovery in some sectors, building back fully will take years, they predict. To some degree, economic recovery in Wichita and Kansas — outside of aviation — will depend on how national improvement looks.
“This will likely remain a volatile time for the Wichita economy throughout 2021 due to the continuing coronavirus outbreak, the rollout of the coronavirus vaccine, and high economic uncertainty both in the national macroeconomy and the aerospace industry,” Hill wrote in the employment forecast.
The Wichita area predictions include Sedgwick, Butler, Harvey, Kingman and Sumner counties.
Aviation losses, hospitality gains
Average employment growth in Wichita could be 0.7% in 2021, which would add more than 2,000 jobs back into the local economy, the WSU forecast predicts.
“I think that’s very good news,” Hill said. “0.7% is pretty strong growth for Wichita, looking at past history. But in context, we’re bringing back the jobs, not expanding.”
Manufacturing is where Wichita will see a continued drop in employment and one of the slowest recoveries. In particular, durable goods manufacturing — which includes aviation, the largest part of the local economy — is expected to decline by more than 1,400 jobs in 2021 because of continued weakness in aerospace.
Durable goods manufacturing in Wichita will likely lag behind the national manufacturing recovery because of how COVID-19 impacted air travel, Hill predicts.
Workers within the production sector can expect gains in other areas, though. Construction jobs in the Wichita area could grow 1.5% this year, according to the analysis.
And employment in the service sector, which was hard hit by coronavirus closures and restrictions, is expected to grow the most in 2021. Jobs in leisure and hospitality could see as much as 4.6% growth in the Wichita region.
Education and health services, also within the service sector, are predicted to bounce back at 2.9% employment growth.
Hill said it could be easy for someone to look at those numbers and think they need to get out of manufacturing. That’s the wrong message, he said.
“It’s just about reopening the market. Those jobs will come back, wages will come back,” Hill said. “Although this is not a positive message about manufacturing, I would not turn away from manufacturing. There is so much opportunity in Wichita and Kansas.”
While the coming years will be difficult in manufacturing and aerospace, Hill predicts that in the long-term, it’s good for workers to stay in those careers.
Employment in financial, professional and business services, which weren’t impacted as greatly by COVID-19, will largely remain flat in 2021. Government jobs in the Wichita region should also remain at relatively the same level.
Jobs in information services are the only part of the service sector that could see a big decline in the new year, with the potential to lose more than 100 jobs.
More promise for the regional economy in 2021 lies within trade, transportation and utilities, a sector which could recover more than three-quarters of the jobs it lost in 2020.
Retail trade is forecast to see the largest gains in that area, adding back more than 700 jobs in the Wichita area.
The rate at which people saved money rose during the pandemic, Hill said. Now they have a pent-up demand to spend that income. For that reason, he believes spending at places like restaurants will return, too.
Within service and hospitality, tourism is a bigger question. Most of Wichita’s hotels and tourism sector rely on business travel, Hill said. Some experts are unsure if that will return to a pre-COVID level.
Wichita economy compared to Kansas
Across Kansas, more than 113,000 workers experienced unemployment in the second quarter of 2020, a big hit after nine years straight of unemployment declines, according to the WSU analysis.
The average employment increase projected for Kansas is 0.7%, on par with that of Wichita, which would mean almost 10,000 jobs for the state in 2021.
Overall, new growth in Kansas is expected to account for about half the employment it lost during the initial coronavirus outbreak.
“Economic uncertainty will remain high statewide in 2021 until the vaccine to the novel coronavirus is administered to the full population, leading to expectations of muted economic recovery throughout the year,” Hill forecast.
Most of the sector-specific growth in Wichita mirrors that of Kansas statewide, with similar gains predicted in construction, leisure and hospitality and education and health services.
The declines in durable goods manufacturing like aviation, as well as information services, continue at the state level.
Noteworthy is the expected 2.4% employment growth statewide in the transportation and utilities sector, “as Kansas becomes a more important distribution hub in Midwestern and national logistics networks,” according to the WSU Center.
Kansas retail spending, sales
The employment forecasts also include estimates on retail sales across the state, a measure of consumer spending and confidence.
The analysis predicts that Kansas retail sales will continue to grow in 2021, as they did in the second half of 2020, but still won’t be as high as a 2019 peak.
In the Wichita area, retail sales are expected to grow 1.3% in 2021. That could make for the highest level of retail sales in the region since 2016.
In 2020, Wichita retail sales declined by 0.6% — much lower than the overall statewide decline of 1.5% in 2020.
While the Kansas City area had the largest dip in retail sales in 2020, it’s also expected to have the fastest recovery in 2021 sales with 2.8% growth.
After a 15% dip in statewide sales in April 2020 alongside COVID-19 closures, that spending largely recovered in May following the reopening of businesses in Kansas.
Overall across the state, retail sales are expected to grow 1.1% in 2021.
This story was originally published January 5, 2021 at 4:41 AM.
