The Twin Cities Region and Other Hotspots for the Medical Device Cluster

On July 1, the Smithsonian opened an exhibit featuring medical innovations in Minnesota’s famous Medical Alley, a region encompassing Minneapolis-St. Paul and 40 miles south to the Mayo Clinic in Rochester, and home to hundreds of healthcare organizations and medical device companies. (See the online exhibit.)

A key economic player in Medical Alley is the medical device cluster—a group of eight industries that deal directly with medical devices (as defined by Greater MSP). Over 3% of the gross regional product comes from these industries that pump $7.1 billion into the local economy annually:

• Electromedical & electrotherapeutic apparatus manufacturing (NAICS 334510)

• Analytical laboratory instruments manufacturing (NAICS 334516)

• Irradiation apparatus manufacturing (NAICS 334517)

• Surgical & medical instrument manufacturing (NAICS 339112)

• Surgical appliance & supplies manufacturing (NAICS 339113)

• Dental equipment & supplies manufacturing (NAICS 339114)

• Ophthalmic goods manufacturing (NAICS 339115)

• Dental laboratories (NAICS 339116)

Nationally, the medical device cluster makes up 411,900 jobs with average annual earnings of $97,677. The largest industry within the cluster is surgical and medical instrument manufacturing, which alone makes up 118,419 of those jobs. What sorts of occupations are we talking about? A lot of production jobs: Team assemblers; dental laboratory technicians; inspectors, testers, sorters, samplers, and weighers; electrical & electronic equipment assemblers; machinists; and the like make up over 40% of all jobs in the sector.

But let’s explore a larger map. Medical Alley isn’t the only hotspot for the medical device cluster. The following infographic ranks the top 10 US metropolitan areas according to greatest number of medical device-related jobs. (Naturally, the region covering Minneapolis-St. Paul-Bloomington-Rochester takes the lead.)

A few big-picture observations:

• Medical Alley has by far the highest number of jobs: over 27,000 in 2014. It’s a pretty steep drop-off to New York (17,828) and Boston (16,878), the next two largest. And it is nearly four times the number as Dallas (7,391), which ranks 10th in the nation.

• Surgical & medical instrument manufacturing is the largest industry in every city except Medical Alley, New York, and Dallas.

• Analytical laboratory instrument manufacturing is the most concentrated industry in four MSAs: San Jose (10.05 LQ), Boston (8.11), San Francisco (4.88), and Philadelphia (2.05). (Concentration is measured by location quotient; the national average is 1.0.)

• Salt Lake City stands out for a few reasons. It has the highest concentration of medical device jobs (4.63) after Medical Alley (4.79). It also boasts the highest concentration for any of the industries inside the cluster; here, irradiation apparatus manufacturing has a stunning location quotient of 21.96. Finally, while medical device jobs elsewhere typically comprise well under 1% of total regional jobs, in Salt Lake City they make up 1.3%—just under Medical Alley’s 1.4%.

• San Francisco has the highest average annual earnings per job ($151,012)—not surprisingly since wages reflect (among other factors) the cost of living.

Watch our video on how to determine industry clusters in your area. For more information on EMSI data and services, contact us. Follow EMSI on Twitter (@DesktopEcon) or check us out on LinkedIn and Facebook.