Hartford Business Journal

14 Hartford Business Journal • April 15, 2019 • www.HartfordBusiness.com By Gregory Seay gseay@hartfordbusiness.com C onnecticut manufactur- ers are full of anecdotes about how they use higher-than-average starting wages to attract and retain younger talent, to replace experienced and aging workers they lose to competitors and retirement. Now, the state Department of Labor has accumulated and analyzed salary data for thousands of manufacturing workers in the state and compared it to pay for all other industries combined. Not surprisingly, the Connecticut wage data amassed by the U.S. Census Bureau and shared with DOL econo- mists show the state's manufacturing workers in the last 10 years, from Dec. 2007 to Dec. 2017 (the latest avail- able data), saw their average monthly salary climb 16.5 percent, to $7,155 vs. a 13.4 percent rise, to $5,859 a month, for all other industries. "That tells me they really are trying to attract new workers into this industry by raising wages,'' said Patrick J. Fla- herty, DOL's assistant research director. Nationally, production workers' paychecks grew at an even faster pace in that 10-year period, climbing 26.1 per- cent to an average $5,448 a month. They also outpaced their other-industry peers, whose average pay rose 24 percent, to a monthly average of $4,572, data show. But a closer look at the decade-long pattern for average salaries among Connecticut manufacturing recruits ages 22 to 24 shows their pay has risen three times faster than young adults in other industries. Connecticut manufacturing workers in that age bracket saw their pay climb 28.1 percent, to $4,169 a month, the past decade vs. a 9.7 percent gain, to $2,593 monthly, for that age group in other industries, data show. "The number is news, but it's no sur- prise whatsoever,'' said Jamison Scott, executive vice president of Woodbridge manufacturer Air Handling Systems. To attract and retain workers, "manufacturers have to pay more,'' said Scott, who also leads the New Haven Manufacturers Association. "I don't even know what the minimum wage is because we're so high,'' he said. Driving the wage increases are myriad factors, including an increas- ingly competitive job market. Despite slow economic growth, Connecticut's unemployment rate remains below 4 percent, which means the labor pool is thin, forcing employers to pay more to retain and attract talent. For manufacturers, the situation has been exacerbated by a well-publicized skills gap. The industry has thousands of open jobs as it deals with a retirement wave among older workers and a lack of enthusiasm among younger people to go into an industry that's been tradi- tionally viewed as dirty and arduous. Connecticut manufacturers have been trying to shed that perception, especially as they move toward the adoption of advanced technologies that require more skills in science, technology, math and engineering. Paul Murphy, executive director of the Aerospace Components Manufacturers, said experienced workers are in high demand, but hard to find. Cyndi Zolty, ex- ecutive director of the Smaller Manu- facturers Associa- tion in Waterbury, said her members are increasingly seeking out and hiring technical high school and college students as interns and train- ing and paying them to fill vital skills needs. Starting pay for those on-the-job training slots, Zolty said, typically ranges from $14 to $16 an hour — well above Connecti- cut's $10.10 hourly wage minimum. The state's median pay in 2017 was $15.64 an hour. Manufactur- ers are also using other perks to lure workers. Scott says his employer, like many other manufacturers, provides full health benefits at no cost to its work- ers as an incentive. Employers say they don't see any relief on pay and benefits, particularly with jet-engine builder Pratt & Whit- ney and Groton submarine-maker Electric Boat, and their suppliers, vy- ing for thousands more workers. Meantime, Flaherty, the DOL as- sistant research director, pointed to a curious trend in the manufacturing pay data. Despite the run-up in average manufacturing pay for 22-to-24 year olds, the industry's overall rise in wag- es was tempered by the fact that one older, high-paid manufacturing worker is often replaced by two younger, lower-paid replacements, he said. The impact is that the younger workers' pay lowers the salary average for all manufacturing workers, mask- ing the pay disparity between them and other workers in this state. Pay Perks CT manufacturing wage growth outpaces most other industries Connecticut manufacturing wages rise faster With thousands of open jobs, the state's manufacturers are offering higher wages and benefits to attract new workers. Below is a breakdown of wage increases manufacturing workers in Connecticut and the U.S. have experienced over the last decade, from 2007 to 2017. The data show younger workers in particular have seen their wages grow faster. 10-year % change in wages Monthly manufacturing wage Connecticut United States Type of industry wages Connecticut United States (4Q 2017) (4Q 2017) All industries, employees of all ages 13.4% 24.0% $5,859 $4,572 Manufacturing, employees of all ages 16.5% 26.1% $7,155 $5,448 All industries, employees age 22-24 9.7% 18.1% $2,593 $2,311 Manufacturing, employees age 22-24 28.1% 29.3% $4,169 $3,235 All industries, employees age 35-44 10.3% 21.8% $6,450 $5,185 Manufacturing, employees age 35-44 13.4% 23.7% $6,816 $5,539 All industries, employees age 55-64 17.1% 25.6% $7,187 $5,459 Manufacturing, employees age 55-64 15.9% 26.4% $8,128 $6,134 Source: Quarterly Workforce Indicators; Connecticut Department of Labor. Patrick J. Flaherty, Assistant Research Director, Department of Labor Jamison Scott, Executive Director, NHMA Paul Murphy, Executive Director, Aerospace Components Manufacturers Young manufacturing workers in Connecticut are earning higher wages compared to their counterparts in many other industries. PHOTO | HBJ FILE

• Cover