Wage and salary growth in Twin Cities drops slightly

MINNEAPOLIS (KMSP) - A federal report found that growth in wages and salaries came to a halt in the Twin Cities metro late last year. In fact, it actually dropped slightly.

Economists say it may be too early to call it a trend, but it may be a sign the strong economy in the metro has some limits. Some low-income workers say they see that first-hand.

Workers spoke about their experiences at a listening session Tuesday night as Minneapolis city officials consider whether to raise the city's minimum wage. The current minimum wage across the state is $9.50 per hour for large employers.

“At the end of the day, you can't really put a number on someone's life and someone's livelihood,” said a retail worker at the meeting. “I make $9.52. I've been working there for almost a year and last week I got a two cent raise.”

This may not be the only example of a worker in the labor market seeing a puny raise. The Bureau of Labor Statistics found in 2016 that the growth in wages in the Minneapolis-St. Paul metro actually declined 0.2 percent.

“Even though I'm self-employed now and make my own wages, I have to think about what people in my community can afford to you know buy my services,” said Blue Delliquanti.

A year earlier, the Twin Cities led the nation's large metros in wage growth.

“The employment numbers themselves have stayed strong,” said Hamline University School of Business Professor Stacie Bosley. “So, it's not so much an issue of whether there are jobs out there, it's a question of whether people who are employed are seeing wage growth.”

Bosley says it's too early to tell whether this will become a trend, but it could have an impact on everyday workers.

“It could definitely mean a tightening market, from their perspective, in terms of the ability to access new vacancies or in the ability to see wage growth in their existing jobs,” said Bosley.

Bosley says the metro's economy remains fairly strong compared to other areas. For instance, Atlanta has a higher unemployment rate and the cost of living is increasing faster there. But she agrees not everyone is sharing in the region's economic bounty.

Bosley says the bureau’s wage numbers are not seasonally adjusted and factors like the colder weather can impact numbers late in the year. She says sectors like health care, education and professional services are still showing strength.