Area wages up 12% in 5 years

October 1st, 2018

By Ron Shawgo | The Journal Gazette

Fort Wayne-area wages have shown strong growth in the last five years, with the rate comparing favorably nationally and exceeding all but one other Indiana metro region, according to a new study.

The results reflect employers responding to a tight labor market and perhaps workers who have acquired skills that demand higher wages, local authorities said.

Hourly private-sector wages in the Fort Wayne Metropolitan Statistical Area averaged $25.68 last month, a 12.2 percent increase since August 2013, after being adjusted for inflation, according to Garner Economics, a consulting firm based in Atlanta. Only the Lafayette-West Lafayette MSA posted a higher rate at 15.6 percent.

The report used data from the U.S. Bureau of Labor Statistics.

“Considering we were at a 7 percent unemployment rate in August 2013 and down to 3.4 percent last month in the Fort Wayne MSA, the tightening labor market could be helping to drive wage growth in this area,” said Rachel Blakeman, director of the Purdue University Fort Wayne Community Research Institute. Not only are wages going up, they are beating inflation, with workers' buying power increasing, she said.

In the same five years, Indiana's statewide average hourly wage increased 4.5 percent to $24.80. Average hourly earnings for all employees reported for August ranged from $20.20 in Mississippi to $42.59 in the District of Columbia, Garner Economics reported. Most states had average wages in the $24 to $26 range.

The Fort Wayne metro's 12.2 percent growth ranks 70th among the 343 MSAs. Because of identical growth rates, some MSA have the same rankings. Reading, Pennsylvania, for example, also ranks 70th. The Fort Wayne metro's average wage of $25.68 ranks 107th.

Wage changes in the last five years were uneven in other Indiana metros. Six metros had wage declines, led by Bloomington with a 10.4 percent decrease. Differences could be the result of each MSA's industry mix, Blakeman said. Fort Wayne has a more diverse mix than, say, Elkhart, with a concentration on recreational vehicle manufacturing, she said.

The report validates anecdotes from northeast Indiana employers who say they might have to pay more but are able to find workers, said John Sampson, president and CEO of the Northeast Indiana Regional Partnership.

The partnership has long emphasized increasing the average northeast Indiana wage.

Given that the Fort Wayne region has been traditionally a lower-than-average wage market for Indiana, the findings indicate “at least we're moving in the right direction,” he said.

The area is below the state and national unemployment rates of 3.5 and 3.9 percent, respectively, “which puts even more pressure on our labor market,” Sampson said. “So, I know the employers are feeling that.”

The Garner Economics report attempts to look into the future as wages fluctuate. Click here to view the report.

“Factors that will affect wage growth in the coming months and years include current labor force shortages, innovation and automation and how it affects productivity, as well as U.S. policies on legal immigration,” the report states.