Fourth Quarter 2020: Jobs Increase Slightly and Median Wage Rises

by Erik Knoder

July 7, 2021

Oregon’s employers reported a total of 2,045,041 jobs during the fourth quarter of 2020 (October, November, and December). This was a small gain (+3,745 jobs) from the previous quarter, but it remained a huge loss in employment (-158,948 jobs) from the fourth quarter of 2019 before the pandemic. The median (middle) wage of all non-federal jobs was $22.91 per hour during the fourth quarter of 2020, which was $0.87 per hour higher than the previous quarter and $1.89 higher than the previous year. This was an increase of 9% over the year.

Why the rise in median wage? Much of it was due to the loss of lower-wage jobs, especially those paying $10 to $15 per hour, and an increase in higher-wage jobs, mainly those that paid more than $60 per hour. Part of this shift to higher-wage jobs was probably due to the continued ability of information workers to work from home during the pandemic. These jobs were much less affected by business restrictions. At the other end of the wage scale jobs paying less than $15 per hour decreased by 182,408 from the previous year. The leisure and hospitality sector alone shed nearly 70,000 jobs from the fourth quarter of 2019 to the fourth quarter of 2020. The other services sector— which includes hair salons, churches, and repair shops – cut about 21,000 jobs. Both of these industries tend to pay low wages. In addition to losing many lower-wage jobs, Oregon added jobs over the year in every wage group above $30 per hour.

Almost all industries lost jobs over the year to the fourth quarter of 2020, but state government added 651 jobs and transportation, warehousing, and utilities added 6,950. The rapid expansion of online shopping and home delivery spurred growth in the transportation and warehousing industries.

Growth was more evident from the third quarter of 2020 to the fourth quarter. Normally the third quarter is the peak employment period for a year, but the recovery from the pandemic boosted fourth quarter employment, albeit by a small number of jobs. The professional and business services sector added 20,413 jobs over the period and paid a median wage of $24.53 per hour. Local government added 7,282 jobs and paid a median wage of $32.18 per hour. Retail trade and trade, transportation, and utilities were two other sectors that added large numbers of jobs from the third to fourth quarters of 2020. The job losses were concentrated in the natural resource and mining sector and the leisure and hospitality sector. Both sectors typically have large seasonal losses in the fourth quarter as the weather worsens. Both also have low median wages.

The minimum wage increased again July 1, 2021, which may help to raise median wages again. The tight labor market of 2021 is also putting upward pressure on wages, and in some cases making the minimum wage less relevant. Expect wage data in 2021 to show continued increase in median wages. It will be interesting to see how wage increases will compare to prices, which are also increasing more rapidly in 2021.

To provide better data, this analysis also filters out job records that probably contain errors. Jobs that report zero hours or more than 999 hours (about 77 hours per week) worked in a quarter and jobs that paid less than the federal minimum wage ($7.25 per hour) are excluded. Jobs that paid more than $500 per hour and reported less than 10 hours work during the quarter are also excluded.

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