April Ross (right, bottom) believes that it’s hard to find jobs in the region that pay a reasonable wage. She and her husband, James Ross, worry about paying the bills and for things that they need for their children, James L. and Khloe Ross. | SUBMITTED PHOTO
April Ross (right, bottom) believes that it’s hard to find jobs in the region that pay a reasonable wage. She and her husband, James Ross, worry about paying the bills and for things that they need for their children, James L. and Khloe Ross. | SUBMITTED PHOTO
SOUTHERN INDIANA — There was a time when April Ross didn’t think about her salary.

She would happily collect her checks, created by $7.25 an hour shifts cleaning buildings or tending to children at day care.

But then Ross had children of her own. 

“Now that I have kids, it’s more, I need $13, $14, $15 an hour,” she said. “And Southern Indiana just doesn’t offer that. They don’t.”

It’s not that the jobs aren’t there. Southern Indiana and the nation, really, is crawling with opportunity. There are “now hiring” signs stuck into the ground, hung on buildings and plastered on vehicles.

In the United States, unemployment is the lowest it has been in almost 20 years, and politicians won’t let you forget it.

President Donald Trump has proudly heralded the country’s 3.9 percent unemployment rate in tweets, and he crowed over the subject at his Evansville rally on Thursday, also pointing out the historically low rates for African Americans, Latinos, Asian Americans, women and individuals without high school diplomas.

The strong economy has also been cited by multiple candidates running for re-election (including Rep. Trey Hollingsworth when he visited the News and Tribune’s offices last month).

But national headlines have occasionally carried a caveat: Wages haven’t been receiving the same miraculous treatment. Across the country, they’re not really moving at all.

Since 2013, wages have only increased 2 to 3 percent year after year, according to the Bureau of Labor Statistics. Before the recession, they were moving along at around 4 percent every year. The Pew Research Center points out that when adjusted for inflation, today’s hourly average wage has the same purchasing power as it did in 1978.

In Southern Indiana, things are worse.

WHAT’S HAPPENING LOCALLY

Job announcements in Southern Indiana are often met with aplomb. If there isn’t a press conference in an empty warehouse, there’s usually a news release with quotes from a CEO, One Southern Indiana, and city and state officials.

These ceremonies often contain mentions of wages: How much they’ll be on average and the number of people they’ll go to.

There have been four such announcements about which the News and Tribune has written this year. Like the rest of the country, unemployment is not an issue for Southern Indiana. The most recent rate for the metropolitan area was 4.3 percent in June, the lowest it's been over the last 10 years.

Despite this, wages haven’t been increasing at all in the area.

Uric Dufrene has access to millions of tables of economic data in his role as the Sanders Chair in Business at Indiana University Southeast. And what he sees in regard to wage growth in the Louisville Metropolitan area is disappointing: hardly any year-over-year wage growth at all since 2015.

For many families, this means strained budgets as costs climb, but not income, Dufrene said.

Ross, who is unemployed for medical reasons and whose husband only makes around $12.75 an hour in manufacturing (his options limited by a years-old criminal charge) frets over simultaneously paying the bills for her $800-a-month home and for buying diapers and clothing for her two children.

“I feel like a horrible parent because I can’t give my kids new stuff,” she said.

Overall, the area’s wages are well below the nation’s average, although that’s to be expected with Indiana’s low cost of living. In 2016, the average salary for private jobs in Clark, Floyd, Harrison, Scott and Washington counties — known as Region 10 — was $43,389 per year.

Manufacturing is the largest defined industry in Region 10, employing 14 percent of the people working in the counties, according to STATS Indiana. While the jobs pay more on average than other industries in the area, the Louisville metro’s manufacturing positions actually pay less (at $992 per week) than those in Indiana’s 14 other metropolitan areas, according to Dufrene’s data, also from STATS Indiana. Only manufacturing positions in Muncie pays lower.

There is no clear-cut reason for any of this.

MULTIPLE POSSIBILITIES

It’s not that well-paying positions don’t exist in Southern Indiana. Ross is one doctor’s OK away from working again. When she’s cleared, she plans to look for jobs in the $12 to $14 range.

She sees positions that pay $16 an hour. They just seem out of reach for someone without a college degree or some sort of post-secondary certification.

Educational attainment is one of the many factors that Dufrene believes could be influencing wages in Indiana. The industries prevalent in the area could be a factor as well (high tech, Southern Indiana is not).There’s also the threat of global competition.

But educational attainment is the one factor cited by One Southern Indiana President and CEO Wendy Dant Chesser, too.

Residents of Clark County aren’t earning bachelor’s degrees at the same rate as those living around the rest of Indiana and the nation, while Floyd County residents are just behind the country. It’s not all about college, though. Extra skills can be obtained through certifications or in-house training.

Most companies aren’t going to increase wages for employees who aren’t increasing their skill set, said Dant Chesser. That’s not easy for everyone, though.

Ross can’t see herself going to college at the moment. She’s busy enough taking care of two children, one of whom has their own medical issues.

On the national level, experts are offering their own reasoning for widespread wage stagnation: health care costs, the decline of labor unions, noncompete clauses, a large pool of workers outside of the formal defined workforce and job growth in low wage jobs have all been cited.

It’s still an enigma though, as to why Southern Indiana’s manufacturing wages are so behind the rest of the state’s. Even Dufrene is mystified by the trend.

ADDRESSING THE PROBLEM

Ross, who lives in Jeffersonville, wishes that she could tell that her city officials are working as hard as her family is. She’s heard her mayor, Mike Moore, say that he no longer wants to attract businesses paying paltry wages to the city, but she hasn’t personally seen any results.

It’s a “chicken and egg” scenario, though, Dant Chesser said. One Southern Indiana is an economic development organization for Clark and Floyd counties, meaning that part of its job is to attract employers to the area with marketing efforts and by compiling incentive packages for companies, complete with tax abatements and other goodies that influence businesses’ decision when looking for a new place to settle down.

1si focuses on only pursuing companies that plan to pay above the average wage of the county in which they intend to make their home. But when the local workforce is unskilled, only companies that pay lower wages are going to be interested in locating to the area. Dant Chesser’s solution is to focus on training the workforce — an issue close to 1si’s heart and at the core of its WorkHub program.

Moore, by the way, said his strategy to lure businesses to the area involves improving the quality of life in Jeffersonville with new parks and education initiatives.

River Ridge Commerce Center, Jeffersonville’s business and industrial park, which is well known for its focus on manufacturing employers, claims 28 companies on its website. Executive Director Jerry Acy said that wages are a priority for the commerce center, but that they’re only one of the considerations for River Ridge when its board chooses to sign a tenant. The potential business’ industry is a big factor (River Ridge doesn’t want to attract any meat processing plants, for example), as well as what kind of financial investment the company plans to make within the business park.

Dant Chesser admits that wages in the area could improve.

The amount one adult must make to meet the minimum standard of living in Clark and Floyd counties is $10.75 an hour, according to a calculation from the Massachusetts Institute of Technology. When you add a child to the dynamic, that parent or guardian needs to take home $22.48 an hour to make a living wage — an amount that’s below the average wage of Clark and Floyd counties.

Dant Chesser thinks those numbers should cause some head scratching and, quite possibly, conversation. 

For anything to change, Dant Chesser believes that groups will have to sit down together, talk about what they want and figure out how to make things happen.

But Dant Chesser is also honest about her motivation to do so.

“Am I ready to issue a call to action for that? No, maybe not,” she said.

Dant Chesser doesn’t think Southern Indiana is in crisis mode currently. To avoid a future one, though, she’s supportive of starting a discussion about wages.

It’s going to have to be a deep one, she thinks.

THE ROLE OF THE BUSINESS

What duty do individual businesses have to pay a living wage?

Their primary motivation is to attract the labor that they need, and they only really need to pay what’s necessary to do so, Dufrene said.

But the choice is more layered than that to Mike Dahl, the CEO of Mobile Initiative.

Dahl recently announced that his tech company, which manufacturers cell phones, tablets and other smart technology, will be opening a production facility Clarksville … and paying their employees $23.97 an hour — a rate well above Clark County’s average. Even the location’s production floor workers will still be paid well at around $20 an hour.

Dahl doesn’t want to just find people to hire. He wants to hire people who will stay. And people who will work hard.

It’s a business decision, but there’s also a coating of altruism to the entire concept as well.

Dahl worked in retail for seven to eight years before he started his company, and it was a “brutal” experience for him. He dealt with unpleasant situations and customers, and he didn’t get much in return.

Dahl wants to pay his employees a wage that will improve their quality of life — even if it costs him. Not that he thinks it will. If his workers are happy, he believes that it will reflect well on Mobile Initiative’s brand.

It’s not all about wages, though. Mobile Initiative wants to promote a positive culture through company outings, and he plans to eventually open housing for employees.

In the wake of low unemployment, other employees have turned to benefits other than wage increases. Dant Chesser knows that Heartland Payment Services, for example, subsidizes day care for their employees. She’s also seen billboards advertising flexible hours for other companies.

For some workers, that might be more important than more money.

This past year, six new companies have announced that they’re coming to the area, adding $81.5 million to the region's payroll, according to 1si’s annual report. Only one of those will be paying low wages, Dant Chesser said. She declined to name the company, but said that it will be adding a high number of jobs.

1si did not send out a news release to announce their coming.

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