Occupational Advantage: Detecting and Enhancing Occupational Mix in Regional Development

In this paper, we explore the increasingly significant role of human capital in regional development by presenting a number of hypotheses about the nature and extent of regional occupational specialization and exploring these with data analysis on national trends and on the Minneapolis/St. Paul metropolitan area. Nationally, we find that a region's occupational mix cannot be mapped simply from its industrial mix – most occupations are quite diversified across industrial sectors and have shifted over the past decade from concentrations in manufacturing toward services, a pattern particularly strong for the high tech occupations. For our case study region, we find occupational specialization to be significant, changing over time, and not predictable on the basis of past specialization, confirming the potential for an economic development approach that creates and attracts human capital as well as firms/employers. We conclude that economic development specialists would do well to spend greater efforts on investigating the generation and locational determinants of worker locational choice and on enhancing the attractiveness of regions to select occupations. We also suggest a methodology, similar to industrial targeting in some ways but unique in others, for targeting occupations at the regional level.