Recession Job Losses and Recovery Job Gains by Wage Level in Jackson County

by Guy Tauer

June 25, 2018

Now that payroll employment is well above its pre-recession peak in Jackson County, let’s take a look back on trends in job growth by wage level. In real, or inflation-adjusted dollars, the annual average wage per job rose from $41,085 in fourth quarter 2007 to $43,296 in fourth quarter 2017. Total private-sector payroll employment in the fourth quarter of 2017 is now about 4,000 jobs above the pre-recession total in the fourth quarter of 2007, for a gain of 5.4 percent during the past 10 years. It was far from a linear, slow climb. Rather the opposite, with total private-sector employment falling by about 9,400 in just two years from fourth quarter 2007 to fourth quarter 2009, a decline of 12.6 percent. During the next eight years private-sector payroll employment gained about 13,400 jobs, for an increase of 20.6 percent.

Now let’s look at how those recession-era job losses and recovery job gains were distributed by industry wage level. For this analysis, industries were sorted by average wage and then grouped by low, medium and high wages with roughly one-third of total private-sector employment in each category.
High-Wage Industries

For this analysis, high-wage industries were those with an average annual pay of $37,333 or higher in the fourth quarter of 2007. This high-wage group of industries lost about 2,690 jobs during the recession, a decline of 10.8 percent. During the recovery from fourth quarter 2009 to fourth quarter 2017, this group of industries gained 4,043 jobs, a gain of 18.1 percent. This leaves the high-wage industry group with an overall job gain of 5.4 percent from fourth quarter 2007 to fourth quarter 2017.

High-wage industries adding substantial jobs over the last 10 years include ambulatory health care services (+2,093), professional and technical services (+340), truck transportation (+233), chemical manufacturing (+185), and machinery manufacturing (+167). Industries in this group losing jobs during that 10-year period were heavy and civil engineering construction (-419), telecommunications (-372), insurance carriers and related activity (-250), and merchant wholesalers of durable goods (-163).

Medium-Wage Industries

Industries in this group had annual average wages per job between $22,811 and $37,332. Employment declined by about 4,760 jobs from the fourth quarter of 2007 to the fourth quarter of 2009, a decline of almost 19 percent. During the recovery over the next eight years the medium-wage group of industries gained 3,980 jobs, leaving this group about 780 jobs below the pre-recession peak total in fourth quarter 2007 or about 3 percent fewer medium-wage jobs than in the fourth quarter of 2007.

Industries in this group gaining notable jobs during that 10-year time period included food manufacturing (+489), agriculture and forestry support activities (+356), private educational services (+247), general merchandise stores (+209), real estate (+183), and beverage and tobacco product manufacturing (+174). Those shedding jobs included specialty trade contractors (-373), printing and related support activities (-204), motor vehicle and parts dealers (-157), and furniture and related product manufacturing (-140).

Low-Wage Industries

This group of industries had average annual pay of $22,810 or less in the fourth quarter of 2007, representing about one-third of private-sector employment. Employment in this group saw the least number of total jobs lost during the recession (-1,938) and the lowest percent decline (-8.0%) among the three wage group categories in Jackson County. During the subsequent recovery from the Great Recession, low-wage industries added the greatest total jobs (+5,373) and had the largest percent change (+24.2%) from fourth quarter 2009 to fourth quarter 2017. This group of lower paying industries is now about 3,440 jobs above the pre-recession peak in fourth quarter of 2007, a 22.3 percent increase.

Low-wage industries losing jobs during the prior decade included clothing and accessory stores (-279); amusement, gaming and recreation (-216); personal and laundry services (-31); and gasoline stations (-27). Since these are fourth quarter (October, November, and December) comparisons, some of the decline in amusement, gaming and recreation jobs may have been due to the delayed start of the winter sports season in 2017 and not a delayed arrival of winter snows in 2007.

Industries in this group adding notable jobs during that decade included food services and drinking places (+1,561), nursing and residential care facilities (+586), private households (+438), and miscellaneous store retailers (+272). Miscellaneous store retailers is the industry where marijuana dispensary establishments are found. It should also be noted that the average wage in the nursing and residential care facilities industry rose from $21,876 in the fourth quarter of 2007 to $33,748 in the fourth quarter of 2017. If the wage group categories had been chosen using 2017 wages, then nursing and residential care facilities would have been bumped up to the middle-wage industry group.

Looking at these longer-term trends gives a hint of what the outlook for the next 10 years in some of these industries might be. Not that the future will be totally based on what has happened in the past, but it does provide some of the background information that affects future employment forecasts. We will be releasing our 2017 to 2027 employment forecasts by industry and occupations soon, so this is a good starter to see where some of those industries may be heading in the coming years.

Despite slightly stronger growth in lower-wage industries over the past decade, job growth in high-wage industries and rising average wages in many industries kept real or inflation adjusted average wages rising by $2,200 from fourth quarter 2007 to fourth quarter 2017 in Jackson County.

 


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