Oregon’s rising wages outpace inflation, finally
Published 3:00 pm Sunday, April 23, 2023
SALEM — Inflation cooled off a bit last year, but Oregon wages didn’t.
That’s good news for the state’s workers, most of whom are earning more than they did a year ago, even factoring in rapidly rising prices.
Oregon’s average private-sector wage was $34.07 an hour in February, according to Oregon Employment Department data. That’s up 9.1% from a year earlier.
Inflation rose by 6.2% during the same period, gobbling most of those pay gains. But even after factoring in the rising prices, wages were up 2.7%.
Oregon’s wage growth appears to be outpacing national pay hikes, according to the employment department’s data. It’s not clear why — the labor market is tight everywhere, and Oregon’s jobless rate is modestly higher than the national rate.
Employment department statistics coordinator David Cooke suggests Oregon might be outpacing the nation because the state has a higher concentration of more lucrative jobs, or perhaps because of rapid increases in Oregon’s minimum wage.
Wages have been rising rapidly since the pandemic began, in large part because of a persistent worker shortage in Oregon and across the country. Those rising wages have been one factor pushing up inflation. And that, in turn, has been eating into workers’ wages.
And a year ago, inflation had the upper hand. Oregon wages declined by 1.6% after accounting for rising prices.
Not everyone is keeping up, of course. Averages smooth out big differences among workers and industries.
Oregon’s biggest pay gains last year came in a niche category called “other services,” where pay climbed 6.6% after accounting for inflation. That’s repair and maintenance work, religious organizations and a collection of other relatively small industries.
A broader category, educational and health services, was up 4.3% after inflation. And construction wages climbed 4.1%. Those are industries where the demand for skilled workers consistently exceeds supply.
The market for hospitality workers is tight, too, but employers appear less willing to solve that problem by raising pay. Wages in the hotel and restaurant sector were flat after accounting for inflation at $21.71 an hour.
There’s wide variation by region, too. Private-sector wages were up 8.6% in the Salem area after adjusting for inflation. Medford, Corvallis and Eugene had big gains, too.
But Bend’s booming growth didn’t translate to rapidly rising paychecks. Inflation-adjusted wages fell by 4.8% there in the past year. The numbers don’t have a definitive explanation as to why, but Bend remains a popular tourism destination and the resulting concentration of hospitality jobs may play a role.