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Average hourly wages increase in Arizona, still below national rate

Posted 12/19/19

PHOENIX — Arizonans continue to take home more money.

New figures Thursday from the state Office of Economic Opportunity show that wages in here are 5.4% higher now than they were a year …

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Average hourly wages increase in Arizona, still below national rate

Posted

PHOENIX — Arizonans continue to take home more money.

New figures Thursday from the state Office of Economic Opportunity show that wages here are 5.4% higher now than they were a year earlier. That compares to a 3.2% year-over-year growth for the country.

Arizona wages still trail the rest of the country, with average hourly earnings here at $26.85 versus $28.21 nationally.

But Doug Walls with the OEO said that 5.4% growth translates out to $1.37 an hour for the average worker. And in the past five years, earnings here have increased by 18% — $4.05 an hour — versus the $3.43 for the rest of the country.

At least part of that is due to the 2016 voter approved measure raising the state minimum wage from $8.05 an hour to $11 now. Increases at the bottom tend to push up salaries for everyone else above that figure.

And that minimum is set to go to $12 an hour on Jan. 1.

But Mr. Walls said average wages also are being driven up by a 12% increase in the average salaries being paid by manufacturers.

Some of that, he said, is the increase in the number of higher-paying jobs at companies making computers, electronic parts and in the aerospace and defense industries. And then, Mr. Walls said, is the simple issue of supply and demand, saying there is a “pent-up demand for available skills” at some of these firms.

Meanwhile, Mr. Walls said, consumer spending on a per capita basis for 2018 — the most recent figures available — was up 4.2%.

Mr. Walls said there are two basic conclusions from those numbers.

One, he said, is Arizonans feeling “more confident about their current situation.” Put simply, if people think their jobs are secure — and maybe there even are wage increasing coming — they’re going to spend more.

The other, he said, is that the employment situation here is so good that people are “finding more opportunities within the Arizona economy.” That means an ability to find jobs as well as an ability to change jobs and get a pay raise.

Some of that, however, is getting eaten up with inflation.

For the Phoenix metro area, the only data for Arizona, the consumer price index is up 2.5%, versus 1.7% nationally.

The findings come as employers reported they added 34,200 workers last month, all but 1,700 of that in the private sector. And overall employment at private companies is up by 71,400 from a year ago.

That was good enough to drop the state’s seasonally adjusted unemployment rate a tenth of a point, to 4.7%.

It continues to remain higher than the rest of the country with a 3.5% jobless rate. But Mr. Walls said at least part of that is because the number of people in Arizona in the workforce — both employed as well as those looking for jobs — is rising three times as fast here as the rest of the country.