Wages in most of Ohio’s largest counties are rising, but average pay is not keeping up with inflation.
In the nation’s 335 largest counties, weekly wages rose 0.6 percent between the first quarter of 2012 and 2013, according to data released by the U.S. Bureau of Labor Statistics.
During that same time, wages increased 1.8 percent in Butler County, 1.6 percent in Hamilton County and 1.7 percent in Warren County, the data show. These counties have fared much better than most nationwide.
But the pay data has not been adjusted for inflation, and when wages are adjusted for price increases, most gains disappear.
“In very, very few counties across the country are wages going up above the rate of inflation,” said Jeff Rexhausen, senior research associate at the Economics Center at the University of Cincinnati. “For both households and government, they are having to make do with less real buying power.”
In the first quarter of 2013, U.S. workers on average earned $989 per week, according to labor data. That was up from about $983 in the first quarter of 2012.
Between the first quarters of 2012 and 2013, wages increased about $15 to $848 in Butler County; $17 to $1,109 in Hamilton County; $7 to $836 in Montgomery County; and $14 to $835 in Warren County, according to data that has not been adjusted for inflation.
Eleven of Ohio’s 13 largest counties saw wages rise this year, and Lake County saw the strongest growth up $27, or 3.4 percent.
But when the wages are adjusted for price increases, 11 of Ohio’s counties saw wages decrease, and Butler County saw no gains and Lake County saw only a $13 bump, according to data adjusted by the Dayton Daily News using the bureau’s Consumer Price Index.
Still, Butler County ranked among the top 20 percent of U.S. counties for changes in pay this year, and Hamilton and Warren counties ranked among the top 25 percent.
A significant portion of Butler County’s job growth has taken place in the medical field, which typically pays high wages, said David Fehr, the county’s director of development.
Many of the county’s newer manufacturing facilities, such as Amylin Pharmaceutical in West Chester, provide jobs that require advanced skills and therefore pay well, he said.
The industrial mix of each county plays a role in whether wages increased, decreased or remained flat, Rexhausen said.
Urban counties have more federal, state and local workers, and cash-strapped government agencies have frozen the pay of many of their workers, he said.
Butler and Warren counties likely have a higher share of private-sector workers, and they have a strong segment of higher-skilled professional service jobs.
“As we move toward an economy that relies on those jobs, we’ll see pay increases there,” Rexhausen said.
Butler and Warren counties also saw lower than average employment growth year-over-year in the first quarter, and sometimes employers give their existing workers raises as sales increase instead of hiring new workers, he said.
Counties that saw higher payroll growth may see wages decrease, because new hires often earn less than workers with more experience and tenure, he said.
“In the case of Butler and Warren County, I think more of the wage growth is due to raises — not paying new workers, but paying raises to existing workers,” Rexhausen said.
He noted that “government is severely constrained, so we are not seeing raises for government workers.”
Wage growth or wage stability allows workers to maintain or improve their standards of living. But it is also important for municipal governments, which depend on income taxes to fund their services, experts said.