Local workers make gains, despite national economic mood
Posted: Sunday, August 10, 2008
Earlier this year, Site Selection magazine named Siouxland as the No. 1 metro area among metro areas of its size for economic development for 2007. The ranking was based on objective criteria that involved jobs created, capital invested, and facilities constructed.
In the Q&A below, Joseph Wright, vice president of technology transfer for The Siouxland Initiative, talks about what the tri-state region's economic performance has meant for local workers.
Q: How does employment in the metro area compare to the national average?
A: In July, Iowa Workforce Development released the 2008 Siouxland Regional Laborshed Survey and Analysis, an important indicator of workforce strength. The survey reported that Siouxland's unemployment rate is 3.3 percent. That number is much lower than the national average of 5.{M37 percent. This number is positive in two ways. First, it shows that more Siouxland workers are employed than are their counterparts in other areas of the country. Second, this low number indicates that we are not being affected as much by the economic downturn as other regions in the US. To put into perspective how good this number is, California has an unemployment rate over two times larger than ours, and Michigan has an unemployment rate nearly three times greater.
Q: So, we have plenty of jobs here in Siouxland, but are they good paying jobs, and are wages increasing? Has all this recent local economic success put more money in Siouxland workers pockets?
A: To answer that question we need to look at what the Siouxland worker makes compared to the national average. In addition, it may be helpful to look at what Siouxland workers made in the past compared to what they are making in the present.
To make a useful comparison, adjustments for inflation and cost of living must be made. With these adjustments for inflation and cost of living, in 2008 on average the Siouxland worker made $16.45 per hour, while the national average was $17.95 per hour. That means that on average Siouxland workers are paid $1.50 per hour less than other Americans. The conclusion being, that we have room for improvement in wages paid.
Q: How does today's wages in Siouxland compare to past years?
A: Two years ago, Iowa Workforce Development released the 2006 Siouxland Regional Laborshed Survey and Analysis. Adjusting those numbers for inflation and factoring in the cost of living, in today's dollars, Siouxland workers made $15.98 per hour two years ago (47 cents per hour less than the $16.45 per hour they are making today), and the average American made $18.08 per hour, or 13 cents per more then they make today).
That is a sharp contrast. In the last two years national wages have fallen slightly while Siouxland wages have risen significantly. All things being equal, two years ago the Siouxland worker made on average $2.10 less an hour than the typical American worker, but just in the last two years that gap has been narrowed 60 cents to $1.50 per hour.
Thus, with the Siouxland worker making more and the typical American worker making less, the wages of Siouxland workers are inching closer to the national average. It should be noted that going back four years shows that national, as well as Siouxland wages, did not change much, up or down, during the 2004-2006 period. In contrast, Siouxland wages have climbed in the period between 2006 and 2008 while national wages have not kept up with inflation. These positive wage numbers, combined with Siouxland's low unemployment figures mentioned above, show that indeed the recent economic success in our area has benefited Siouxland workers.
A recent study by the Bureau of Economic Analysis reported that Siouxland personal income increased in 2007 by 6.9%, that puts Siouxland in the top 10% of US metros in income growth. That number tells us that not only are wages increasing but the amount individuals are making is going up as well.{M3 These positive numbers, combined with Siouxland's low unemployment figures mentioned before, show that indeed the recent economic success in our area has benefited Siouxland workers.
Q: What more can be done to raise local wages?
A: In our economic development efforts The Siouxland Initiative and our partners in economic development have been, and will continue to be, focused on recruiting companies into our area that hire workers at wages above the current regional average. Our rationale is that more jobs alone is not economic growth. True economic growth includes growth in wage earnings in addition to the sheer number of people employed.
Q: The national economy has shown signs of faltering. What's happening with the local economy?
A: The Siouxland Intiative recently surveyed more than 40 major employers in the region. Of those, more than 75{M3% have plans to hire more employees.
This positive news compliments the statistics that gave rise to our number one ranking in Site Selection Magazine, which found the region had 23 qualifying projects in 2007. Continued success in recruiting outside companies, coupled with the plans for future expansions planned by local companies, lead to one conclusion, our community is headed in the right direction economically. That is great news for Siouxland, and especially for Siouxland workers.
.
In the Q&A below, Joseph Wright, vice president of technology transfer for The Siouxland Initiative, talks about what the tri-state region's economic performance has meant for local workers.
Q: How does employment in the metro area compare to the national average?
A: In July, Iowa Workforce Development released the 2008 Siouxland Regional Laborshed Survey and Analysis, an important indicator of workforce strength. The survey reported that Siouxland's unemployment rate is 3.3 percent. That number is much lower than the national average of 5.{M37 percent. This number is positive in two ways. First, it shows that more Siouxland workers are employed than are their counterparts in other areas of the country. Second, this low number indicates that we are not being affected as much by the economic downturn as other regions in the US. To put into perspective how good this number is, California has an unemployment rate over two times larger than ours, and Michigan has an unemployment rate nearly three times greater.
Q: So, we have plenty of jobs here in Siouxland, but are they good paying jobs, and are wages increasing? Has all this recent local economic success put more money in Siouxland workers pockets?
A: To answer that question we need to look at what the Siouxland worker makes compared to the national average. In addition, it may be helpful to look at what Siouxland workers made in the past compared to what they are making in the present.
To make a useful comparison, adjustments for inflation and cost of living must be made. With these adjustments for inflation and cost of living, in 2008 on average the Siouxland worker made $16.45 per hour, while the national average was $17.95 per hour. That means that on average Siouxland workers are paid $1.50 per hour less than other Americans. The conclusion being, that we have room for improvement in wages paid.
Q: How does today's wages in Siouxland compare to past years?
A: Two years ago, Iowa Workforce Development released the 2006 Siouxland Regional Laborshed Survey and Analysis. Adjusting those numbers for inflation and factoring in the cost of living, in today's dollars, Siouxland workers made $15.98 per hour two years ago (47 cents per hour less than the $16.45 per hour they are making today), and the average American made $18.08 per hour, or 13 cents per more then they make today).
That is a sharp contrast. In the last two years national wages have fallen slightly while Siouxland wages have risen significantly. All things being equal, two years ago the Siouxland worker made on average $2.10 less an hour than the typical American worker, but just in the last two years that gap has been narrowed 60 cents to $1.50 per hour.
Thus, with the Siouxland worker making more and the typical American worker making less, the wages of Siouxland workers are inching closer to the national average. It should be noted that going back four years shows that national, as well as Siouxland wages, did not change much, up or down, during the 2004-2006 period. In contrast, Siouxland wages have climbed in the period between 2006 and 2008 while national wages have not kept up with inflation. These positive wage numbers, combined with Siouxland's low unemployment figures mentioned above, show that indeed the recent economic success in our area has benefited Siouxland workers.
A recent study by the Bureau of Economic Analysis reported that Siouxland personal income increased in 2007 by 6.9%, that puts Siouxland in the top 10% of US metros in income growth. That number tells us that not only are wages increasing but the amount individuals are making is going up as well.{M3 These positive numbers, combined with Siouxland's low unemployment figures mentioned before, show that indeed the recent economic success in our area has benefited Siouxland workers.
Q: What more can be done to raise local wages?
A: In our economic development efforts The Siouxland Initiative and our partners in economic development have been, and will continue to be, focused on recruiting companies into our area that hire workers at wages above the current regional average. Our rationale is that more jobs alone is not economic growth. True economic growth includes growth in wage earnings in addition to the sheer number of people employed.
Q: The national economy has shown signs of faltering. What's happening with the local economy?
A: The Siouxland Intiative recently surveyed more than 40 major employers in the region. Of those, more than 75{M3% have plans to hire more employees.
This positive news compliments the statistics that gave rise to our number one ranking in Site Selection Magazine, which found the region had 23 qualifying projects in 2007. Continued success in recruiting outside companies, coupled with the plans for future expansions planned by local companies, lead to one conclusion, our community is headed in the right direction economically. That is great news for Siouxland, and especially for Siouxland workers.
.
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ER wrote on Aug 13, 2008 8:32 AM: