A job today is the same as a job yesterday, or is it?? What is the importance or measure of the "value" of jobs in the United States, Wyoming, counties within Wyoming and the surrounding states??
One way to evaluate the quality of a job is to examine its value in terms of dollars. Covered employment and wage data are collected in the same way from each employer covered by Unemployment Insurance (UI) so the employment and payroll data can be compared at many geographic levels above the county level within each state. This is an important tool in any training or economic analysis.
How is Wyoming's labor market changing?? How is Wyoming's economy in comparison with the surrounding states?
Change tells us about economic opportunity. However, employment change affects the value of other components involved in the economic process. Categories of economic resources, or factors of production include: (1) property resources of land (or raw materials) and real capital (investment goods), and (2) human resources of labor and entrepreneurial ability.
If we view employment from the perspective as being a component of the production process, then we want to find measures or measurements common to labor as well as to capital. For example, if our objective as local bank board members is to see the real value of our bank stock grow--we need to be making loans which assure us a rate of return above the rate of inflation.
The rate of inflation is a rising general level of prices, or the cost of living. One often hears that the cost of living in Wyoming is less than it is nationally. Since the ability to afford the cost of living in directly linked to the wages earned, having a "good" job is essential. In order to evaluate job quality we must examine its value in terms of dollars. However, a dollar ten years ago bought more goods and services than the same dollar would buy in today's marketplace.
To give us a common denominator or way in which to compare wages across time and distance, we can use a standard technique of "deflating" today's wages to some pre-selected time in the past. By adjusting for the effects of inflation we can look at today's nominal wages in terms of what they would have been worth in the past: "real" (yesterday's value) wages. By adjusting wages from different time periods and places to the same point in time (so they have the same common denominator), we are then able to accurately compare them.
How do we adjust for inflation? The Consumer Price Index (Urban) CPI-U for a particular period establishes typical expenditures reported by all consumer units in urban areas. The nominal average weekly wage and total payroll data are adjusted for inflation using the CPI-U. These resulting figures, or "real" wages, are more representative of our economy's progress from the baseline time period. Using the 83CPI-U, a dollar was worth a dollar in the third quarter 1983, and during the second quarter 1994 it only was worth 68 cents!!
With the average weekly wage stagnant or declining, the individual or familial stress in order to achieve the American dream, or even to survive, is overwhelming. An individual either would have to work more hours, start a new business, or work more jobs to make up the difference in today's nominal wages and yesterday's "real" wages. When the effects of the baby boom generation, ages 28-45 and now accounting for about one third of the overall working population, their high labor force participation rates and resulting labor oversupply are examined, it can be seen there is further downward pressure on the value of labor (lower wages). Even though Wyoming showed an employment increase of 6,979 jobs (3.4%) in second quarter 1994 compared to second quarter 1993, the nominal second quarter 1994 average weekly wage (AWW) of $421 increased $7 (1.7%) over same period 1993 (see Table 1). The average weekly wage percentage change did not keep up with the rate of inflation during this time period. While the nominal AWW indicated an increase of $7 from 93:2Q through 94:2Q, in "real" dollar terms, after "deflating" 94:2Q AWW to $285, we lost $2 per week!!
All states must submit their employment and wage data to the Federal Bureau of Labor Statistics quarterly. This allows prompt evaluation and economic analysis in comparing Wyoming with the surrounding states and United States from 1992 to 1993. After reviewing the data, it is no wonder given the consequences of the declining average weekly wage on the eve of the election and end of the recession, that the mood of the people resulted in drastic changes at the polls. Looking at the fifty states and the District of Columbia the 1993 average annual pay by state, Wyoming ranked 42nd with $21,745. Annual average pay levels nationwide varied by industrial division, as it did regionally. (See Table 3) As one can see in Table 3, when the 1993 average annual pay was "deflated," the "real" wages did not overcome the effects of inflation (3.0 percent).
Looking at our region, Colorado ($25,682) ranked 16th; Utah ($22,250) ranked 37th; Idaho ($21,188) ranked 45th; Nebraska ($20,815) ranked 46th; Montana ($19,932) ranked 48th; North Dakota ($19,382) ranked 50th; and South Dakota ($18,613) ranked 51st. With an annual average pay of $21,745, Wyoming had the third highest average annual pay within the region in 1993. Wyoming's percentage growth from 1992 to 1993 was fifth in the eight state region (see Table 3). Data released by the U. S. Department of Labor Bureau of Labor Statistics Bulletin USDL 94-454 showed the District of Columbia and South Dakota posted the largest percentage increase in pay from 1992 to 1993 (3.3 percent). However, South Dakota which registered one of the largest percentage increases, had the lowest 1993 average annual pay.
Areas of growth at all geographic levels within Wyoming, the surrounding states, and the United States are comparable to that experienced in Wyoming: services and construction show the highest employment increases. Within the eight-state region (Wyoming, Colorado, Idaho, Montana, Nebraska, North Dakota, South Dakota, and Utah), Wyoming ranked eighth with a 2.3 percent employment gain. Comparable percentage change for all U. S. industries between 1992 and 1993 was 1.9 percent.
Today's jobs are not the same as yesterday's jobs. After examining the quality of employment in terms of dollar value, today's wages have not kept up with the rate of inflation.
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