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Raising Wages Key to Sustained Economic Recovery
Sarah Osmer

June 13, 2010
View the Original Article

Editor’s note: This is the first in a series of commentaries from area leaders exploring the economic challenges facing Asheville, Buncombe County and Western North Carolina.

The AC-T editorial “Looking for economic answers requires asking the right questions” (May 30) illuminates many of the greatest challenges we face in the economic recovery of our region. Indeed, wages in Buncombe County and Western North Carolina in general lag behind those in other parts of the country. Many of the decent-paying jobs have been outsourced, being replaced by jobs that pay near poverty wages.

In fact, 26 percent of Buncombe County’s workforce earned less than a living wage in 2009, according to the Employment Security Commission. That’s one in four workers in our community that, despite work, struggle to meet their family’s most basic needs. Of the 25 fastest growing occupations in the mountain area, nearly half pay low-wages. According to projections for 2006-2016, these 10 growing occupations will create 6,990 new low-wage jobs in the mountain area. That’s a percent change of 230 percent in low-wage occupations.

This trajectory of our local economy — a growing low-wage workforce coupled with the high cost of living of our region — is a potential recipe for disaster.

While education, transportation, and affordable houses are key issues to be addressed in order to create a more sustainable local economy, there is one critical issue that must also be considered —raising wages.

Increasing workers’ wages to a living wage (now $11.35/hour for Buncombe County) provides just the sort of stimulus our local economy requires. Research demonstrates that workers who earn a living wage rely less on social services and public benefit programs, effectively decreasing the burden placed on tax-payers and charities to subsidize employers’ low wages. Higher wage earners also have less health problems and lower-stress levels than their low-wage counterparts. Living wages also benefit employers. Worker productivity increases with higher wages, as does employer-loyalty. Training costs and turnover decrease when workers are paid a living wage. Workers who earn more also spend more, circulating dollars back into our local economy.

Fortunately, there is some progress being made to ensure that more workers might enjoy the benefits of living wages. Just Economics certifies local employers that pay a living wage. Over the past two years, over 130 employers have been Living Wage Certified, amounting to an impact of $2.1 million in increased wages pumped back into our local economy. Green Opportunities trains low-income youth to work in green jobs, which typically pay well above a living wage. The United Way of Buncombe County also has identified increasing the number of workers who earn a living wage as a key community issue to be addressed. These are just a few examples of initiatives already underway to turn the tide against our growing low-wage economy.

The assumption that seeking further education, improving transportation access, and decreasing housing costs will solve our local economy’s woes overlooks the fact that our region is experiencing most job growth in low-wage industries. Even those who have the opportunity to seek higher education or find affordable housing could find themselves struggling to support themselves and their families because of the dearth of decent paying jobs.

Until workers have access to living wage jobs and we as a community intensify our focus on bringing living wage employers to our region, our economy will continue towards an unsustainable and unjust future.

Sarah Osmer is executive director of Just Economics of Western North Carolina.