Eastern Oregon’s Minimum Wage – July 1, 2022
June 29, 2022Wage estimates from third quarter 2021 reveal that 5.9% of all jobs in Eastern Oregon (Baker, Grant, Harney, Malheur, Morrow, Umatilla, Union, and Wallowa) paid the minimum wage while 26.7% of jobs in the region paid less than $15.00 per hour. In comparison, 5.1% of jobs statewide paid the minimum wage while 14.6% paid less than $15.00 per hour.
Set at $12.00 per hour for nonurban counties in 2021, the minimum wage steps up to $12.50 per hour on July 1, 2022. Urban counties will see the minimum wage set at $13.50 while the Portland Metro area will reach $14.75. This is the final pre-set step increase for minimum wage, which was set by Senate Bill 1532 in 2016. Starting in 2023, minimum wage will be tied to the Consumer Price Index (CPI) with urban counties set as the standard minimum. Minimum wage for nonurban counties will be $1.00 less than the standard and minimum wage for Portland Metro will be $1.25 above than the standard.
Wage Hike Felt Most in Harney, Grant, and Malheur
In terms of total county employment, Morrow had the smallest share of minimum wage jobs in 2021. Just 3.3% of Morrow County’s 7,409 jobs paid minimum wage. Morrow also had the smallest share (20.6%) of jobs below $15.00 per hour. Three counties saw minimum wage jobs account for more than 9.0% of their total employment: Malheur at 9.1%, Grant at 9.4%, and Harney at 11.6%. Two of these counties also saw the largest share of jobs below $15.00 per hour: Harney at 32.9% and Malheur at 37.1%. Baker County had the third largest share of jobs below $15.00 per hour at 28.9%, while Grant came in at 27.2%
Umatilla County accounted for the largest number of minimum wage jobs in Eastern Oregon. At 1,661 jobs, Umatilla supplied 31.8% of all minimum wage jobs in the region. This isn’t surprising given Umatilla’s hefty share (43.9%) of Eastern Oregon’s total employment. In terms of proportions however, Umatilla accounted for fewer minimum wage jobs than would be expected. Malheur County on the other hand accounted for more than would be expected. Malheur supplied 25.9% of all minimum wage jobs in the region while accounting for just 16.9% of Eastern Oregon’s total employment. Union County also supplied a large portion (13.1%) of the region’s minimum wage jobs. More closely in line with the county’s 13.4% share of Eastern Oregon’s total employment.
Wage Hike Felt Mainly in Four Sectors
Just over two-thirds of Eastern Oregon jobs that paid minimum wage were found in three broad sectors (out of 15). Local government; retail trade; and leisure and hospitality accounted for 67% of all minimum wage jobs in Eastern Oregon. In addition, natural resources and mining; retail trade; and leisure and hospitality accounted for 63% of jobs that paid less than $15.00 per hour in the region. Altogether, these four industries accounted for 77% of Eastern Oregon’s minimum wage jobs. Seasonal hiring patterns, education levels, and required skillsets heavily influence low-end wages in these sectors. Seasonal spending drives labor demand in leisure and hospitality and also influences retail trade hiring. Seasonal harvesting drives Eastern Oregon’s labor demand in natural resources and mining due to the sector’s significant agriculture component. Many seasonal jobs – such as retail salespersons; food and beverage servers; and farmworkers and laborers for crops – call for workers to perform repetitive tasks. Education and skill requirements for these positions are often low, which can lead to a large supply of qualified applicants and low wages.
Roughly one-third of all jobs that paid minimum wage in Eastern Oregon were in leisure and hospitality. For the region’s leisure and hospitality sector, 18.5% of jobs paid minimum wage while 58.3% paid less than $15.00 per hour. Statewide, 12.6% of leisure and hospitality jobs paid minimum wage while 34.3% paid less than $15.00. Food services and drinking places supplied over three-fourths of all leisure and hospitality jobs in Eastern Oregon in third quarter 2021. The expectation of tips likely boosts total expected compensation for many positions, at the same time putting downward pressure on employer paid wages.
Retail trade accounted for 19.3% of minimum wage jobs in Eastern Oregon. The industry also held a sizeable share of jobs that paid between $15.00 and $30.00 per hour. This is likely due to the absence of tips as expected compensation and possibly a greater availability of low and mid-level management jobs that help boost employer paid wages. For the retail trade sector, 9.0% of jobs paid minimum wage while 44.6% of jobs paid less than $15.00 per hour. Statewide, 10.4% of retail trade jobs paid minimum wage while 31.2% paid less than $15.00 per hour.
Local government accounted for 16.3% of Eastern Oregon’s minimum wage jobs in 2021. Minimum wage jobs accounted for 6.7% of jobs in the sector while 20.3% paid less than $15.00 per hour. Statewide, 2.9% of local government jobs paid minimum wage while just 7.2% paid less than $15.00 per hour. Local government is the largest of the 15 broad sectors in Eastern Oregon at 14.2% of total jobs.
Natural resources and mining accounted for 10.2% of Eastern Oregon’s minimum wage jobs in 2021. Minimum wage jobs accounted for 4.5% of jobs in the sector while 39.5% paid less than $15.00 per hour. Statewide, 5.6% of natural resources and mining jobs paid minimum wage while 24.5% paid less than $15.00 per hour. Natural resources and mining is the second largest of the 15 broad sectors in Eastern Oregon (13.5% of total jobs) with 83.9% of the industry’s employment in Umatilla, Malheur, and Morrow counties. The bulk of minimum wage jobs in the sector were in two of these counties. Malheur County accounted for 40.1% of the sector’s minimum wage jobs while Umatilla County accounted for 28.4%.
Pandemic and Labor Supply Impacts the Estimated Increase
An estimated 5.9% of Eastern Oregon jobs should see a pay increase tied directly to the minimum wage hike in July. This is 444 jobs less than were estimated to be directly affected by the increase in July, 2021, and 1,862 less than were estimated to be directly affected by the increase in July, 2020. The decreasing number of minimum wage jobs in Eastern Oregon is at least partially driven by two factors: pandemic induced job loss that occurred in April 2020, and the difficulties faced by firms trying to fill open positions in an increasingly tight labor market.
COVID-19 restrictions forced large-scale layoffs at the start of the pandemic in a few specific industries. Leisure and hospitality took the brunt of the loss and has since struggled to attract workers. Overall, two employment shifts in wage categories have occurred in Eastern Oregon between third quarter 2019 and third quarter 2021. One was an increase of employment in higher wage categories; the number of jobs that pay $15.00 per hour or more increased by 12,254. The second was a decrease of employment in lower wage categories; the number of jobs that pay less than $15.00 per hour decreased by 13,716. While the net effect was a loss of 1,462 jobs for the two-year period, this loss came from the minimum wage category. Leisure and hospitality, specifically, dropped 717 minimum wage jobs while adding 1,452 jobs that pay between $15.00 and $30.00 per hour.
Since third quarter 2021, the region has continued to see employment gains in industries that experienced losses due to the pandemic. The majority of jobs lost have been recovered and the region’s total employment level was just 170 jobs shy of full recovery in March 2022. Altogether, this implies that most of the under $15.00 per hour jobs originally lost have been added back at higher wages and the current trend is a shift toward pay above $15.00 per hour, even with a minimum wage that’s moving to $12.50.
Each year the Oregon Employment Department produces a series of wage tables for Oregon’s 36 counties. These tables detail the number of jobs by wage category for 13 broad private sectors as well as state and local government. Although these county level tables are not published on Qualityinfo.org, they are available upon request. If you would like one on your county, please contact me at Christopher.M.Rich@Oregon.gov.