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Pay daze: County’s average wage among lowest in region

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Average wages in Johnson County are among the lowest in central Indiana, likely due to a higher percentage of retail and food service jobs locally compared to other communities.

Jobs in retail and food service, which make up about a third of the jobs in the county, pay below the average wage of $15.93 per hour, or $33,134 per year, according to the U.S. Bureau of Labor Statistics.

Average wages in Johnson County have been among the lowest in the region for many years. For the past 10 years, the county’s average wage has been at or near the bottom in central Indiana and well below the state average. Only Morgan and Hendricks counties have a lower average among Indianapolis and the surrounding counties. The average wage covers all jobs located in the county, from part-time workers to top executives.

More than 14,000 positions average less than $11 per hour, while about 12,000 workers average $20 or more, according to STATS Indiana. Johnson County has a total of nearly 43,000 jobs.

A single-earner family making $16 per hour may be on the borderline of needing public assistance such as food stamps, the director of one local helping group said. And inflation outpaced growth in pay during the past decade, meaning that prices for groceries, gasoline and other items are increasing faster than workers’ paychecks.

Marion County has the highest average wage at $23.23 per hour, followed by Hamilton County at $21.10 per hour. Those two are the only ones in the region above the state average.

The averages don’t necessarily mean that Johnson County residents earn less than other people, since the average wage only represents jobs that are located in the county. For example, a Greenwood resident who earns $60,000 per year at a job in Indianapolis is counted in Marion County’s average because the job is there.

About 45 percent of Johnson County workers commute to Marion County, which has one of the top average wages in the state.

But the numbers do show that the county is lagging in terms of high-paying jobs, economist Morton Marcus said.

“A lot of it is retail trade. Some of it is transportation and distribution, warehousing, not necessarily high-paid occupations. St. Francis hospital is located on the north side of the Johnson County line, and if that hospital were on the south side, wages would look higher,” Marcus said.

Annual earnings are $21,609 in retail and $14,148 for accommodation and food service.

Johnson County has the highest percentage of those types of jobs at 33 percent. Retail and food service make up 28 percent of the workforce in Hendricks County, but 25 percent or less in all of the other central Indiana counties.

The wages from those jobs bring down the average and hide some of the county’s better-paying positions. Workers in Johnson County manufacturing plants average about $23.50 per hour, while construction and warehousing jobs are both approaching $20 per hour, according to STATS Indiana.

“It’s a little bothersome that we have such a diverse business base, but our wages — that aggregate gauge — is less,” said Cheryl Morphew, Johnson County Development Corp. president and chief executive officer. “We have a solid manufacturing base. We make things here, but we also have a lot of distribution and warehousing up in Greenwood.”

Average wages for county businesses range from about $9.75 to $20 per hour, according to statistics from the 2012 local survey conducted by Johnson County Development Corp. But that number is much lower for entry-level jobs, where wages average $9.85 to $15.13, Morphew said.

Benefits a plus

At KYB Manufacturing North America in Franklin, the average wage for factory workers is about $16 per hour. While a person just starting out may earn less than that, the company will boost pay for workers who get additional education or gain new skills that can help them transition into more high-paying roles, KYB director of administration Chad Suhr said.

The company primarily promotes from within, so a person starting out at less than $16 per hour can work up to a salaried position averaging more than $20 hourly. Ninety percent of KYB’s workers are full-time positions, and those jobs come with medical and retirement benefits, Suhr said.

“I think we’re competitive based off the average wage for hourly workers or salary workforce. I think where we stand above is in our culture and the benefits that we offer,” he said.

Jobs with benefits and pay above the county average are needed, because people earning less can be at risk for poverty, said Thom Hord, chief executive officer of The Refuge in Greenwood and a Greenwood City Council member.

“You really need to be in that $16-an-hour range really to be able to reap any reward from that. The reward is to be able to try to get yourself ahead a little bit. But for the clientele that’s coming in (to The Refuge), that’s not a wage that most are able to garner,” he said.

Workers with children might even end up worse off if they take a job that pays less, since the money left after paying for child care might be less than they’re getting in unemployment or state assistance, Hord said.

Jobs with wages in the $20 per hour range may not require a college degree, but those jobs in manufacturing or other trades might require a worker to have trained skills above and beyond a high school education, Hord said.

Workers at KYB need at least a high school diploma, but the company prefers to look for new employees who have experience in manufacturing or a consistent work history in another type of job, Suhr said. The company had more than 400 people apply for openings during job fairs conducted in the winter, he said.

Hord said, “The days of the great-paying job even for those with higher educations are really not like they used to be. It’s difficult to get those.”

‘We’re lagging behind’

Paychecks also aren’t going as far as they used to, since inflation is increasing faster than wages. Prices of groceries, clothing, gasoline and health care have increased 28 percent in the past 10 years, while the county’s average wage has grown 23 percent. Workers are forced to spend a larger part of their pay on essentials.

“I think we’re lagging behind. The real wages are not rising rapidly at all. Real wages across the country have fallen as a large part of the recession, and we didn’t fully recover,” Marcus said.

Indiana, which ranks in the bottom third of states for average wage, does not produce products or services that are highly valued by the rest of the country, therefore wages are not increasing to pay people to provide those items, Marcus said.

When wages don’t grow, the standard of living is also stunted, because people don’t have money to spend on bigger or better houses or vehicles, he said.

Local government officials and development groups continue to hunt for companies that will bring high-paying jobs to the area. But the market is highly competitive since the counties surrounding Marion County all have similar characteristics such as access to interstates, Morphew said.

Some counties such as Johnson County also are at a disadvantage compared to an area such as Hamilton County, which already has large, established office parks and headquarters for companies, Marcus said.

Bringing those types of businesses and developments such as medical or high-tech manufacturing firms is the route to ensure the county has more high-paying jobs in the future and increasing the average wage, Morphew said.

“One of the things we want to try to do here in Johnson County is employ people in companies that offer upward mobility. We would love to look at more high tech, more of the advanced manufacturing, the life sciences and medical device companies. That’s how we’re going to raise that overall aggregate,” Morphew said.

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