Tri-Cities wages increase in February, trending higher

Private sector wages in the Johnson City MSA posted the second straight month of strong increases in February.

canstockphoto11452270

Year-over-year increase for the average private sector wage.

Kingsport-Bristol experienced the same upswing, but for the first time in almost four years took a backseat to the Johnson City MSA growth pace.

Preliminary, non-adjusted average private sector wage data for February show the Johnson City Average was up 4.2% in February as it was in January. Kingsport-Bristol’s year-to-year rate was up 3% in February and 2.9% in January.

Last year wages grew about 4.4% nationwide. Kingsport’s annual average was just below that mark at 4.2% while the Johnson City MSA annual year-to-year rate was down 0.3%.

The monthly county total wage for all industries offers a contrasting picture of wages. Since it’s a quarterly by-the-month metric it lags the private sector wage report. The most recent numbers are at the bottom of this report.

Johnson City’s private sector accounted for 78.6% of nonfarm jobs in February. The Kingsport-Bristol share was 86.6%.

The post-recession labor market slump that gripped the Tri-Cities in 2012 until last year put a stranglehold on private sector wage averages in the Johnson City MSA. Before that economic double-dip, it boasted the highest average private sector wage in the Tri-Cities. Kingsport-Bristol now has that bragging right.

February’s report put the weekly average in Johnson City at $647. When adjusted for inflation against a pre-recession benchmark of February 2008 someone with the average had $43 a week less buying power. The annual average last year was $592.

Kingsport-Bristol’s February average was $631. When adjusted for inflation that average private sector worker had $9 a week more buying power. That’s the effect of the slow gains Kingsport-Bristol made during the 35 months in Johnson City when they went the other direction. Kingsport-Bristol’s annual average last year was $638.

Despite the 4.2% February gain the Johnson City average wage ranked next to last among MSAs in Tennessee. Kingsport-Bristol was one notch above Johnson City in the rankings.

Jackson had the lowest average at $599 while Knoxville had the highest at $860 a week.

The average private sector wage is the only Bureau of Labor Statistic report for wages on a monthly basis.

The BLS’s quarterly survey of county ages is a good counter balance to the private sector month wage.

Here’s what the most recent total monthly wage, the year-to-year change and buying power after adjustment for inflations against the pre-recession benchmark is for the counties that make up the Tri-Cities two MSA’s

KINGSPORT-BRISTOL

Sullivan Co. – $861, up 3.4% Buying power up $32

Hawkins Co. – $709, up 5.5% Buying power up $36

Scott Co. VA – $598, down 0.3% Buying power up $18

Washington Co. VA. – $670, down 0.1%  Buying power down $5

 

JOHNSON CITY MSA

Washington Co. – $733, up 1.8% Buying power up $49

Carter Co. – $594, up 5.3% Buying power up $24

Unicoi Co. –  $771, down 0.3% Buying power up $46

 

 

 

 

Tri-Cities job creation up in February, unemployment rate at 8-year low but……

Nonfarm job creation in the Tri-Cities was up for the 11th straight month in February, and the seven-county region’s unemployment rate dropped to a preliminary, non-adjusted eight-year low of 4.9%. You have to go back to April 2008 when the rate was 4.6% for a lower rate.

That’s good news, but a deeper dive into the number takes some of the wow factor off those numbers.

Feb jobsAlthough the nonfarm year-to-year job total is improving it’s back below the pre-recession benchmark. Totals pushed past that benchmark for the first time in November and December before sliding back. That’s not an immediate concern because it fits the normal ebb and flow pattern. A better indicator will come in the second quarter.

And when you compare February’s employment and the labor force with those from April 2008 you see the were 18,982 more people with jobs in 2008. And there were 19,263 more people in the labor force ranks.  February’s unemployment was the lowest in eight years, but there are fewer people with jobs, and the labor force is smaller.

There are  several reasons for the disparity in those employment numbers. Like the rest of the nation, our population is aging. Many workers have retired – or been retired – since the pre-recession days, and employers have not replaced many of them. Technology has also taken a bite out of jobs, so employers are doing more with fewer workers. And, some workers who were laid off haven’t been able to adjust the growing demand for new skills, or lower wages, have simply dropped out of the labor force.

Since February last year, the year-to-year growth rate for nonfarm jobs and employment has been positive for all but one month.  March’s jobs report was lower. Since then employment increased faster than the jobs rate every month except January.

Seeing those rates telling the same labor market story is important because both of the reports have strong and weak points.

The payroll report is the large and best measure of the labor market. It reports the number of people who have jobs and in which labor sector, the hours they worked and how much they were paid. It’s a Metropolitan Statistical Area study, so it offers no information about jobs on the county or city level. It also overlooks many self-employed or contract workers who have a growing share of today’s labor market.

The household U3 report is the smaller study. Some economists – like retired  ETSU economics professor and research associate for the Bureau of Business and Labor Research,  Steb Hipple – call it the most worthless piece of data collected by the federal government.

Still the U3 report is what’s used to calculate the unemployment rate which is the most popular public and media labor market metric. It’s also broken down to the county and cities with 25,000 or more population levels, but its focus is on who has a job – not where the job is located. For instance, a Bristol resident who works in Johnson City is reported in Bristol’s employment. One of its major weaknesses is how it classified people as employed. For instance, a part-time worker working just a few hours a week is classified just like a full-time worker. It also does not differentiate between voluntarily part-time workers and those who would rather be working full-time.

There is one level of the household report that does break out those part-time workers.  That U6 report is considered by many as a more accurate reflection of unemployment, but it’s a national-level report. February’s U6 rate was 9.7% – the lowest since May 2008. The February U.S. U3 rate was 5.2%

Here’s how February nonfarm jobs and employment numbers look

TRI-CITIES,  4.9% down 0.4%

Nonfarm jobs – About 200,000, up 3,100 from February last year.

Employment – 215,824, up 2,651 from last year.

JOHNSON CITY MSA – 5%, down 0.5%

Nonfarm jobs – 78,500, up 900 from last year.

Employment – 85,019, up 1,871 from last year

KINGSPORT-BRISTOL MSA – 4.8%, down 0.3%

Nonfarm jobs – 121,500 – up 2,200 from last year

Employment – 131,500, up 779 from last year

BRISTOL – 5.1%, down 0.4%

Employment – 11,100 up 252 from last year

Bristol employment lags its pre-recession benchmark by 933.

JOHNSON CITY – 4.3%, down 0.5%

Employment – 29,410, up 927 from last year

Bristol employment lags its pre-recession benchmark by 469

KINGSPORT – 5.1%, down 0.2%

Employment – 21,560, up 430 from last year.

Kingsport employment exceeds pre-recession benchmark by 3,606

Home prices increasing faster than wages in Washington, Sullivan counties, affordability down

What an example of a good news, bad news story? Try this one:

Housing affordability in Sullivan and Washington counties has decreased because home prices have grown much faster than wages. Washington County has been much harder on the wage growth scale than Sullivan County.


 

Kingsport-Bristol Jan. job, pay growth leads Tri-Cities

 

A comprehensive study by RealtyTrac shows the affordability index for Sullivan County is down 22% from its most affordable level in 2013. It’s down 12% in Washington County.

That doesn’t mean affordability is in the tank in either county. The index is still above the safety benchmark. But NE Tennessee’s two largest county housing markets are among those counties nationwide that are less affordable than their historically normal levels.

The report analyzed median home prices derived from publicly recorded sales deed data collected by RealtyTrac and average wage data from the U.S. Bureau of Labor Statistics in 456 U.S. counties. The affordability index was based on the percentage of average wages needed to make monthly house payments on a median-priced home with a 30-year fixed rate and a 3% down payment, including property taxes and insurance (see full methodology below).

Out of the 456 counties analyzed in the report, 43 counties (9%) had an affordability index below 100 in the first quarter of 2016, meaning buying a home was less affordable than the historically normal level for that county going back to the first quarter of 2005.

The Sullivan County affordability index in Q1 this year was 117, down from its peak of 150 during Q1 2013.

Washington County’s current index is 115, down from its Q1 2012 peak of 131.

“While the vast majority of housing markets are still affordable by their own historic standards, home prices are floating out of reach for average wage earners in a growing number of U.S. housing markets,” said Daren Blomquist, senior vice president at RealtyTrac. “The recent drop in interest rates has helped to soften the blow of high-flying price appreciation in some markets, but the affordability equation could change quickly if interest rates trend higher and home prices continue to rise faster than wages.”

The report shows the year-over-year median home price in Sullivan County is up 7% while the year-over-year wage growth is up 4%.

In Washington County the year-over-year median home price is up 6% and the year-to-year wage growth is 2%.

Nationwide home price growth is outpacing wage growth in 276 counties – 61% of the markets included in the study.

Report Methodology

The report analyzed median home prices derived from publicly recorded sales deed data collected by RealtyTrac and average wage data from the U.S. Bureau of Labor Statistics in 456 U.S. counties with a combined population of 221 million. The affordability index was based on the percentage of average wages needed to make monthly house payments on a median-priced home with a 30-year fixed rate and a 3% down payment, including property taxes, home insurance and mortgage insurance. Average 30-year fixed interest rates from the Freddie Mac Primary Mortgage Market Survey were used to calculate the monthly house payments. Only counties with a population of at least 100,000 and sufficient home price and wage data quarterly back to Q1 2005 were used in the analysis.

 

Johnson City MSA gets most newcomers, population up; Kingsport- Bristol sees largest loss in state

The Johnson City MSA claimed 98% of the Tri-Cities’ net migration from July 1, 2014 to July 1, 2015. It was enough to give the three-county MSA a population increase of 500 for the one-year period.

At the same time, Kingsport-Bristol saw a population loss of 603. That was the largest loss in the state, according to Census annual population estimates released this week.

Population

Census Bureau current annual population estimates.

Population across the seven-county region was down 103. Since April 1, 2010 it’s down 490 people.

Simply put, newcomers are sustaining the region’s population growth, and it’s not distributed evenly.

Both MSAs are in a negative natural population position. That means the death rate is higher than the birth rate.

Kingsport-Bristol has the larger population of the two MSAs and saw the highest share of births (60%) during the one-year period. Its population base is also older, so it had a higher share of the region’s deaths (62.7%).

Since 2010 the Johnson City metro area has seen a population increase of 1,932, according to this week’s Census report, while Kingsport-Bristol’s population has declined 2,422.

Here’s how the just-released, one-year population numbers looked for Tennessee’s MSAs:

Nashville, up 36,435

Knoxville, up 4,357

Chattanooga, up 3,579

Clarksville, up 3,127

Memphis, up 1,213

Cleveland, up 1,095

Morristown, up 968

Johnson City, up 500

Jackson, down 421

Kingsport-Bristol, down 603

If population trends continue as they are now, projections show Washington County will replace Sullivan and the largest county in the Tri-Cities in about 22 years.

 

 

 

%d bloggers like this: