Oregon Labor Market Information System
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Commercial Banking: There's a Branch Near You
by Christian Kaylor
Published May-20-2013

 
Businesses need only a few crucial elements to survive. It's not much, but each piece is necessary for a business to succeed. First, you'll need a product or service. Next, you'll need good people, managers who know how to manage and employees that do quality work. And of course, you'll need money.

The cliché is that in order to make money, first you have to spend money. Banks provide the start-up money that businesses need to start up and grow. The capital that banks provide to businesses and consumers is the lifeblood of the economy. Beyond that, banks help people save and invest money, while lending money to help people finance cars and houses, and pay for school.

Commercial banks are banks that manage savings and checking accounts and make various types of loans (cars, home mortgage, business loans, etc.) to businesses and ordinary families. There are more than 1,000 banks and branches in Oregon. Some of the larger, better known banks are Wells Fargo, U.S. Bank, Umpqua Bank, and Key Bank.

With almost 15,000 jobs in Oregon and an annual payroll of $780 million, commercial banking is the largest sector of the finance industry, which also includes credit unions, mortgage brokerages, and savings and loans.

Industry Growth and Geography
 
Commercial banking is an industry that has outperformed most of the economy in Oregon. Overall, employment in Oregon is up only 4 percent from where it was 10 years ago. This anemic figure is the result of a major recession and a weak economic recovery. Commercial banking, however, has been largely immune from the poor economy, with employment growing by 33 percent over the same time period.

The industry is present throughout the state of Oregon, with branch bank offices present in every county. The Portland region has relatively more industry employment with 36 percent of all jobs in Multnomah County, despite the county being only 27 percent of all jobs in Oregon.

Occupations
 
Occupational data on the commercial banking sector is not available. However, since commercial banking is the largest sector of the broader finance industry, looking at occupational data there paints an interesting picture.

A handful of occupations make up the bulk of the jobs in banking - a combination of lower paid front office staff and higher paid loan officers and financial specialists. Eighty percent of all employees are classified in just two occupational categories; office and administrative support, and business and financial operations. The other 20 percent are mostly management and sales occupations.

Unsurprisingly, the most common occupation in finance is tellers, with more than one in four employees holding that job. The next most common occupations are loan officers, office managers, customer service representatives, and bookkeeping clerks. Tellers in Oregon earn a relatively low average wage of about $12 an hour. More technical positions that require knowledge of finance pay above average wages. Loan officers, for example, have an average wage of about $31 an hour.

Wages
 
The commercial banking industry in Oregon is not only growing faster than most sectors, it also pays higher wages. The average wage in the commercial banking industry was $52,382 in Oregon in 2012. That's 18 percent more than the average wage in Oregon.

Considering gender, there are some interesting trends. Again, detailed data specifically for the commercial banking industry is not available. However, the industry makes up three-quarters of the "depository credit intermediation" sector, which also includes credit unions and savings and loans. Within this slightly larger sector in 2011, 71 percent of employees were women. This large ratio has actually been declining. Ten years ago, 79 percent of employees were women, a ratio of almost four to one.

The large number of women isn't the only gender gap in the industry. According to figures that cover all workers, including part-time workers who are more likely to be female, men earn 41 percent more than women in the depository credit intermediation sector. While significant, the industry's wage gap is actually slightly less than the 50 percent gender wage gap across the private sector in Oregon. Women in this industry earn an average of $4,029 a month. That's 37 percent more than the average private sector salary for women in Oregon.

Detailed salary data by occupation and gender isn't available. Given the gender gap in wages and the large number of women employed, it's likely that the lower skill customer service positions, such as tellers, are mostly women. Men are likely more common in the higher skill and higher wage occupations that require technical financial knowledge.

Summary
 
With almost 15,000 jobs in Oregon, commercial banking is a big employer, making up the largest portion of the state's finance sector. These firms also provide a service that is critical to all Oregon businesses. The sector pays higher-than-average wages, and employment has grown significantly over the past decade.