July 28, 1997 in Nation/World

The Great Divide Lost Wages Jobs Are Plentiful In Spokane, But Many Don’t Cover The Cost Of Living

Story By Grayden Jones
 

Howard Blackwell, a convicted armed robber and drug dealer, walked out of the Airway Heights Correctional Center figuring it would take a miracle to find a job.

So when a North Spokane steel factory hired him on the spot at $6.50 an hour earlier this year, Blackwell shed tears of joy.

“I got the job! I got the job!” the quiet 37-year-old father from Seattle repeated. “This is so amazing.”

Perhaps not as amazing as Blackwell thought.

Thanks to an abundance of low-paying jobs, Spokane has become a smorgasbord of opportunity for those who don’t mind earning less money.

Low wages, in fact, have become so common that the state Department of Employment Security says the county is the No. 1 place in Washington for convicts to find work.

“Opportunities for jobs are better here than in Seattle,” said Blackwell, who wants to raise his family far from the temptations that lured him into crime in the Emerald City. “The jobs may not pay as much, but there’s a lot more of them.”

Laying claim as the state’s premier place for convicts to find work may not be what Spokane economic development officials have in mind.

But it says volumes about the structure of the community’s low-cost economy and how it differs from the state’s powerful economic engine - King County.

Here, jobs are plentiful for unskilled and semi-skilled workers. From slinging burgers to assembling circuit boards, there’s a great low-paying job for just about everyone.

But in King County - a sprawling metropolis of 1.6 million people that’s endowed with a major university, the world’s largest airplane maker and the world’s richest man - high-paying jobs are rampant.

Workers in King County earned an average wage of $30,719 in 1994, the most recent year figures are available. In Spokane, workers made $22,831.

And while Spokane County incomes are rising each year, every economic measure shows wages have been falling behind Seattle’s roaring economy like a caboose unhitched from the train.

It’s not that people are out of work: Spokane County’s unemployment lines have rarely been shorter. Unemployment in June was 4.3 percent, right behind King County’s stunning 3.3 percent.

It’s the difference in wages that hurts. Manufacturing workers in Spokane County receive 82 percent of what workers in that industry group statewide are getting, according to a 1995 analysis by The Pace Group, a Mississippi-based economic think tank.

The wholesale distribution industry paid 75 percent of the state average wages. Only one industry group - health care - matched wages paid statewide, Pace said.

For many Spokane families, the gap in wages between Spokane and King counties is the difference between central air conditioning and a swamp cooler, shopping at J.C. Penney’s or at Value Village.

For others, it’s a down payment on a home, a year of college for a child or the chance for one spouse to stay home with the children.

The wage divide hasn’t always been this big. Decades ago, when Seattle was a fishing port and Spokane a hub of logging, farming and mining, many workers in the Lilac City fared better than King County laborers.

But the wage gap has been widening for years as Spokane struggles to replace its fading natural resource industries. State forecasters do not expect the gap to improve any time soon, since it usually takes a shortage of workers to push wages higher.

State economists project employment to grow 14.5 percent in King County during the next five years as demand for workers in aerospace, technology and exporting fuels the job market and wages. Spokane will grow as well, but at less than half the rate, or 5.7 percent by the year 2000.

“There’s three things Seattle has that Spokane doesn’t,” said Paul Sommers, economist with the Northwest Policy Center in Seattle. “Boeing, a humongous manufacturer with high wages; a rich software industry led by Microsoft; and a major university and research center.

“A smaller city can get a chunk of those things,” he said, but rarely can it get them all.

Spokane is making some gains, albeit slowly. Plans for a regional cancer center fashioned after Seattle’s Fred Hutchinson Cancer Center were announced last week, and workers are wiring property east of downtown in anticipation of the completion of the Riverpoint Higher Education Park, a campus shared by several universities.

Flipping burgers

Seattle and Spokane are only 280 miles apart. But the industries found at a major exporting seaport, surrounded by millions of consumers, provides a huge advantage over an inland, agrarian community where 406,000 people reside in a largely service-oriented economy.

Spokane’s leading industry, based on the number of people employed, is eating and drinking establishments - businesses that typically pay less than $6 per hour. In Seattle, it’s aircraft, where thousands of people earn in excess of $20 per hour.

But the divide goes beyond comparing aerospace jobs at Boeing with bagging hamburgers at Dick’s. Spokane wages are not just lagging, they’re a generation in the past, compared with Seattle, state records show.

Tracking more than two dozen positions, the Employment Security department has found that four out of five jobs in Spokane paid less in 1995, after being adjusted for inflation, than the same job paid in King County 10 years earlier.

Consider the average Spokane computer programmer. She saw her wage rise a healthy 71 percent in 10 years, from $10.48 per hour in 1985 to $17.89 per hour in 1995. Meanwhile, the wage of her King County counterpart wage rose 62 percent in the same period, from $15.36 to $24.82 per hour.

Sounds OK, but it will take the Spokane programmer light years to catch up. By adjusting her 1995 wage for inflation to reflect its value in 1985 dollars, she actually earned $12.63 per hour. That’s nearly $3 per hour less than what the King County programmer got 10 years earlier, when Ronald Reagan and Mikhail Gorbachev were in power.

Some jobs do pay better in Spokane, according to surveys by the Washington Employers Inc. in Seattle and Associated Industries of the Inland Northwest.

Production painters, forklift operators, systems analysts and personnel managers all earned more in Spokane. And many public employees benefit by receiving paychecks that are based on higher statewide pay scales.

But the wage gap is worse for those in lower-end jobs.

Inside sales representatives and parts counter salespeople on the West Side earn 70 percent more than the same positions in Spokane, the employers’ surveys show. West Side electronics assemblers, drafters, secretaries, data entry operators and receptionists take home 25 percent more.

“I went to college to get a job so I wouldn’t be flipping burgers anymore,” said Alecia Layton, who hocked her wedding ring earlier this year after she was laid off at The Steer Inn fast food restaurant.

She and her husband, Ron, haven’t had a vacation since their honeymoon in Sandpoint three years ago. They raise their 2-year-old son in a two-bedroom North Spokane apartment, where neighbor kids dash in for afternoon drinks as Ron Layton attempts to sleep off his graveyard shift as a night auditor for Cavanaugh’s Inn at the Park.

Layton, 31, said he likes the job, which pays less than $900 per month before deducting taxes and Social Security. But it’s not enough to cover the family’s $495 monthly rent, the food bill, and utility, car and insurance payments.

The Laytons supplement their income with food stamps, a $100 allowance from the Spokane Housing Authority and occasional trips to the pawn shop. Nearly all of the couple’s wedding presents have been sold or used as collateral for loans, including a 23-inch Sony television and VCR.

“It’s not like I want to live in a big mansion, but I get tired of collection agencies calling me all the time,” said Alecia Layton, who is 24. “If one of us was making $9 to $10 an hour, we’d get our stuff out of the pawn shop.”

‘In a time wrap’

Low wages can be offset by a lower cost of living, and Spokane residents like to take comfort in the knowledge that it costs less to live here than in King County.

But that ignores a painful fact - Spokane residents actually have less money to spend after paying bills and other necessities, an economic study shows.

Matching Spokane’s wages against its cost of living, the average resident ends up with less - not more - money to spend than 97 out of 100 metropolitan areas in the United States, according to Financial Associates, a Philadelphia consulting firm.

True, it costs less in Spokane to go to a movie, run the air conditioner and rent an apartment. But once the bills are paid, Regional Financial Associates says, the average worker has less to spend at the end of the week than workers in Los Angeles, Honolulu and Seattle.

New York City is among the few U.S. cities where workers have less discretionary spending money than the average Spokane worker.

“Spokane is in a time warp, which is one of the nice things about it. But it’s a bit of a throw back, and it could be getting passed up,” said Jon Flora, who left the community six years ago to snag a pay raise and become president of the Independent Colleges of Washington in downtown Seattle.

Flora said it is tougher to make friends in Seattle, and his $1,000-per-month day-care and diaper bill is outrageous. But with a higher salary and benefits, he said, he comes out ahead.

“Now, that I’m over here, it’s real easy to forget about Spokane,” Flora said. “Around here, we’re talking about Microsoft spinoffs, Boeing mega-mergers and clearly, this is the corporate center of the state. It would be nice to see some money going into Spokane other than for Taco Time.”

Some Spokane newcomers such as Christina Dills are willing to pay the price for escaping King County’s violent crime, stalled freeways and unfriendly sprawl.

Dills left her native Mercer Island last year to join a Spokane law firm, escape the rat race and be closer to her boyfriend. The attorney estimates the choice costs her $10,000 to $15,000 in lost income each year.

“This is a great place to raise a family because the values are conservative and old-fashioned,” Dills said. “Men still open doors for women and there’s more chivalry. It’s nice to see that.”

But even those with good jobs have reason to be concerned about the economy and how it compares with Seattle.

Higher wages and jobs in King County and elsewhere are a siren call for talented Spokane graduates and workers, draining away some of the community’s brightest future leaders.

“We’re exporting some of the finest minds in our community,” said Terry Brown, chief executive officer of the Community Colleges of Spokane. “We got to get out of the exporting market.”

A shortage of money also turns voters into misers at the ballot box, setting up important spending issues for failure. Strapped for cash, Spokane voters are reluctant to tax themselves for school operations, science centers, police protection and filling potholes.

Lower incomes also result in greater poverty, a social problem that everyone pays for. Spokane County’s poverty rate exceeds state levels, with one out of five children living below the poverty line.

State Department of Health and Human Services officials say a single parent needs to earn at least $19,000 a year, or about $9 an hour, to support themselves and get off public assistance.

Welfare reform could make the low-wage problem worse. Reforms will force 9,000 adults on public assistance in Spokane County to find a job, which could depress wages by creating an abundance of unskilled workers chasing the same jobs.

“Because we already have so many low income workers, when you add the expectation of more on public assistance entering the work force, that will put more downward pressure on wages,” said Sen. Lisa Brown, D-Spokane, an economist at Eastern Washington University. “Among other things, that may have a negative impact on people who are not on public assistance.”

The threat of falling further behind King County and the rest of the state has alarmed public and private leaders so much that they buried Momentum, a highly praised 10-year program to create jobs and raise incomes. In its place, they organized a new consortium called Focus 21. The primary mission of Focus 21 is to add 10,000 jobs by 2002 that pay $28,000 per year or more.

“It’s one thing to make the car payment and house payment and pay for groceries,” said Gordon Budke, president of Focus 21 and managing partner of Coopers & Lybrand public accountants. “But do people have enough money to buy a boat, go on a vacation, buy nice clothes and educate their kids? That’s what makes the economy really grow.”

Not every employer wants to see wages rise, though.

Some concede privately that Spokane’s cheap cost of labor is how they operate profitably. Low wages have been a magnet for telemarketing and back-office customer service centers, which avoid high labor rates and office rents in King County and elsewhere.

Shaq attack

In some ways, comparing the Spokane and King County economies is like measuring gymnast Kerri Strug against basketball star Shaquille O’Neal.

As the world’s giant airplane maker, Boeing employs 91,400 people in King County, nearly all at livable wages. The number of employees at that one company would equal nearly half of all workers in Spokane County.

Boeing sells dozens of jets each year, fetching $150 million apiece for some models.

To understand how much money that is, you would have to pool all the revenue generated for a year by Sterling Savings, EZ Loader Boat Trailer, Shea Construction, Output Technology, Gold Reserve Corp. and Ross Printing Co. to equal one airplane.

In King County, where a $400 million Nordstrom headquarters store is under construction across three blocks of downtown Seattle, business activity is so robust that merchants generate $3 million in sales every hour, around-the-clock. It takes Spokane County merchants six hours to generate that much sales, the state Department of Revenue says.

When the Seattle Supersonics play at Key Arena, the gate for a two-hour basketball game is $564,300. In 25 years of fundraising, the Community Colleges of Spokane, where 22,000 students are enrolled, haven’t raised that much money for their endowment fund.

Forbes magazine recently declared Microsoft founder Bill Gates the world’s richest man, with a net worth of $36.4 billion. Gates likely has other plans for his money, but he has enough to buy all of Spokane County - land, houses, offices and factories - twice.

But such wealth isn’t always to be coveted.

Ron and Julie Bohman fled King County in 1994 to open the Genesis Granite headstone engraving company in north Spokane. Ron Bohman, a former Boeing engineer and marine engine distributor, said his family felt out of place around the affluent lifestyle of the West Side.

“If my daughter didn’t shop at the Gap or the Bon or Nordstroms, she was instantly ostracized,” he said. “Kids would brag about going to Hawaii for vacation.”

Moving to Spokane took courage for Bohman, who recalls his image of the city as a place where a weather man from Seattle could be elected mayor, a reference to the late Ron Bair.

“I’d rag on Spokane because it was such a hick town,” Bohman said. “But I like it here, even if that’s what you want to call it.”

Chris Majer, president of the Seattle-based SportsMind consulting and owner of a $500,000 home on Lake Coeur d’Alene, said there’s a heightened intensity in Seattle that he doesn’t feel in Spokane.

“There’s more urgency,” Majer said. “There’s more aggression and ambition because people have a desire to have their dreams come true faster.

“The two worlds are radically different. In Seattle, they have a diamond-in-the-back, sunroof top, Gortex expandomatic attitude. But Spokane is not concerned with style and looking good. There’s a vast divergence in the two economies.”

Optimists such as U.S. Bancorp economist John Mitchell believe Boeing, Microsoft, Nintendo and other King County employers will fan the flames of economic growth in Spokane’s direction.

But others, such as Washington State University economist Gary Smith, have their doubts. Smith, who has studied Spokane for years, said the community always follows the lead of the national economy, not King County’s.

“Spokane has a life of its own,” he said, “separate from the West Side.”

, DataTimes ILLUSTRATION: 9 color photos 4 Graphics: 1. Who is richer? 2. Gauging the economy 3. By the numbers: jobs and money 4. By the numbers: businesses and money

MEMO: This sidebar appeared with the story: REFS SCORE IN SEATTLE Youth soccer looks pretty much the same whether it’s played in Spokane or Seattle. But referees know the difference: Seattle clubs pay their refs up to three times as much. The Washington Youth Soccer Association says King County soccer clubs pay referees $20 per game for teams with players age 14 and under, $30 for an under-18 premier game. Linesman earn half the rate of the refs. Referees have to train to qualify for the job, but they need only be 3 years older than the players. That means a 15-year-old referee can earn $20 per game all day Saturday. Games typically last 60 to 90 minutes. Referees who work for the Spokane Youth Sports Association, the city’s largest soccer club, get $6.50 per game for children’s games, and $21 for under-18 premier. Linesman, now known as assistant referees, earn $7 to $11 per game.

THE COUNTY WHERE PERSONAL EARNINGS ARE KING How big is the average wage gap between Seattle and Spokane? If the typical King County family were content to live on a Spokane income, they could quit work Sept. 13 and take a three-and-half-month vacation each year. Half of all households in King County earn more than $48,700 each year; half earn less. In Spokane County, the median household income is $34,600.

THE HIGH COST OF POVERTY More than $15 million in public assistance pours into Spokane County each month. That’s enough to build three elementary schools, power a large company or operate a small city. The county receives $3 million in food stamps monthly, or nearly 10 percent of the state total. Another $2.2 million - 6 percent of the state total - is spent for Aid For Dependent Children. And $10 million in Medicaid covers medical and dental bills, as well as nursing home and long-term care.

This sidebar appeared with the story: REFS SCORE IN SEATTLE Youth soccer looks pretty much the same whether it’s played in Spokane or Seattle. But referees know the difference: Seattle clubs pay their refs up to three times as much. The Washington Youth Soccer Association says King County soccer clubs pay referees $20 per game for teams with players age 14 and under, $30 for an under-18 premier game. Linesman earn half the rate of the refs. Referees have to train to qualify for the job, but they need only be 3 years older than the players. That means a 15-year-old referee can earn $20 per game all day Saturday. Games typically last 60 to 90 minutes. Referees who work for the Spokane Youth Sports Association, the city’s largest soccer club, get $6.50 per game for children’s games, and $21 for under-18 premier. Linesman, now known as assistant referees, earn $7 to $11 per game.

THE COUNTY WHERE PERSONAL EARNINGS ARE KING How big is the average wage gap between Seattle and Spokane? If the typical King County family were content to live on a Spokane income, they could quit work Sept. 13 and take a three-and-half-month vacation each year. Half of all households in King County earn more than $48,700 each year; half earn less. In Spokane County, the median household income is $34,600.

THE HIGH COST OF POVERTY More than $15 million in public assistance pours into Spokane County each month. That’s enough to build three elementary schools, power a large company or operate a small city. The county receives $3 million in food stamps monthly, or nearly 10 percent of the state total. Another $2.2 million - 6 percent of the state total - is spent for Aid For Dependent Children. And $10 million in Medicaid covers medical and dental bills, as well as nursing home and long-term care.


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