News Column

History of Idaho's Great Wage Divide

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Between 2008 and 2011, median hourly wages climbed 1.3 percent, and inflation increased 4 percent.

Idaho's median household income dropped 9 percent from 2008 to $43,341 in 2011 -- the 10th lowest in the country.

How have Idaho wages grown over the years?

Not much if you adjust for inflation. Wage growth was about 3.4 percent over the past three decades, according to the Idaho Department of Labor.

But that figure isn't universally accepted. It doesn't reflect factors such as the cost of health insurance premiums paid by companies, which are effectively an increase in pay that doesn't show up in wages, says Peter Crabb, professor of finance and economics at Northwest Nazarene University in Nampa.

Inflation also is based on several factors, and not everyone is equally affected. For example, not everyone feels the pinch of the cost of education, Crabb says.

What do Idaho's low wages mean in practical terms?

Finding a living-wage job in Idaho is tough.

Only a third of Idaho jobs paid a living wage in 2012, down from 40 percent in 2006, the Labor Department says. A living wage is defined as $39,000 a year for a couple with two children in urban areas, and $36,400 in rural areas. For a couple, it's $22,977 urban and $22,146 rural. For a single person, it's $14,021 urban and $13,513 rural.

The shortage of living-wage jobs also contributes to Idaho being one of the top 10 states for people holding multiple jobs. Seventy-four of every 1,000 Idaho workers held more than one job in 2011, up from 71 in 2010.

OK, that all seems pretty bleak. But aren't Idaho's low wages a reflection of our low cost of living?

The cost of living is lower in Idaho than in many places, but that's only part of the reason our wages are lower, says Brian Greber, director of Boise State's Center for Business Research and Economic Development. Suppose someone living in Boise makes the state's median annual salary of $23,192. If that person moved to any of several medium-sized cities such as Denver, Little Rock or Cincinnati, where costs of living are higher, the Boise salary would be about 80 percent of the amount needed in the other cities to compensate, Greber says.

Kendall Automotive Group, based in Boise with dealerships in Montana, Oregon, Idaho and Alaska, says it pays its Idaho staff on par with employees in Oregon. Its Alaska stores pay more, because the cost of living in Alaska is higher than in the lower 48 states.

Lot attendants, who keep the cars clean, don't start at Idaho's minimum wage of $7.25. They begin at $8.50 in hour. In a matter of weeks, the good employees are bumped to $9, says Dave Blewett, Kendall's president.

"One of the reasons we do that (is) our people are somewhat mobile," Blewett says. If he wants to move an employee from Oregon to Idaho, he doesn't face opposition from workers resisting pay cuts.

The Statesman, however, has heard from several workers who say they lost money by taking jobs in Idaho at lower wages than comparable jobs in other states and who say the cost of living isn't really less.

A Treasure Valley physical therapist, who asked that her name not be used, says she took a one-third cut in pay to come to Idaho from another state several years ago and has received only one raise in several years, which amounted to about $50 a month. "If anything, rent is higher," she says . "Certain other things are about the same."

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