Troubling trend seen in 'defining industries' Economist sees promise in emerging technology

BYLINE: Don Mecoy, Business Writer

Gambling, call centers and meat packing have become three of Oklahoma's top 10 "defining industries" - sectors with employment that are much more concentrated here relative to the nation, the head of the Oklahoma City Federal Reserve branch said Wednesday.

Gambling's share of the state's employment relative to the nation's ratio is exceeded only by the oil and gas sector and trade schools, bolstered by the state's strong career-tech program, said Chad Wilkerson, branch executive and regional economist at the Oklahoma City branch of the 10th District Federal Reserve bank.

Wilkerson spoke to about 200 bankers and business leaders at an economic forum in downtown Oklahoma City, sponsored by the local branch of the Federal Reserve Bank of Kansas City.

Employment in the energy industry is 8.2 times more concentrated in Oklahoma than in the nation; gambling is 3.4 times more concentrated here, Wilkerson's study showed.

Between 1990 and 2005, gambling, call centers and meat packing registered the largest annual job growth among the state's defining industries and moved into the top 10, Wilkerson said.

Those three industries also provide among the lowest wages among the top 10, he said. "That is a bit of a troubling trend."

However, Wilkerson said emerging industries in nearby states that provide much higher wages could become the next drivers for job growth in Oklahoma.

Biotech laboratories, which Oklahoma City is seeking to attract to its downtown research park, have become a key job growth provider in Kansas and New Mexico, Wilkerson said.

Wireless telecommunications, which includes at least one large provider in Tulsa, has become a defining industry in New Mexico.

Software and computer hardware design, which offer very high wages, have emerged in Colorado, he said.

"Many of these industries seem like they might fit in Oklahoma," Wilkerson said.

"Some of them already are starting to."

Defining industries tend to drive a state's job growth, Wilkerson said. The short-term outlook for Oklahoma's most concentrated sectors looks good, he said, as the Oklahoma economy is generally strong.

Oil and gas should do well as long as commodity prices remain high, and manufacturing in Oklahoma is performing better than the nation as a whole, he said.

The car rental and military sectors also appear to be well positioned for the next two years.

Wilkerson's long-term view, however, is less optimistic.

"Here the story is a little more mixed," he said.

The casino market likely will become saturated and long-term job growth in manufacturing and farming should be "sluggish," he said.

Oklahoma's labor market is tight, and the pool of workers could become shallower as some workers flee the state prior to the Nov. 1 activation of controversial immigration enforcement legislation that levies new penalties for hiring illegal immigrants.

"The availability, especially of skilled workers, is going to be a challenge," he said.

Metafund President Tom Loy, whose business helps finance businesses, said out-migration is his biggest personal concern about the state's economy.

"(Wilkerson) mentioned that there's already evidence of migration out of the state," Loy said. "I see that as being a real threat to the labor force."

Don Mecoy: 475-3942, dmecoy@oklahoman.com