Colorado Springs wage earners are catching it from both ends: the cost of living is rising and paychecks aren’t keeping pace, compared to national averages for each.
The Bureau of Economic Analysis reported Thursday that local incomes — measured on a per person basis — last year rose 3.8% to $48,492. But the increase was well behind the 5% jump in the national average, putting local workers even further behind what the average U.S. resident brings home.
Meanwhile, the cost of living in Colorado Springs has climbed above the national average for the first time in 20 years and stayed there.
Put simply, what that means is your money doesn’t go as far here.
“If the cost of living is above the national average and wages are just 89% of the national average, that is a problem. You are losing purchasing power,” said Tatiana Bailey, director of the University of Colorado at Colorado Springs Economic Forum.
“If we want to sustain economic growth, we have to be able to attract labor and this makes it more difficult to attract and retain labor.”
This income trend is not new — local incomes have lost ground to the national average for the past nine years. Last year, they were just 89.1% of the national average.
Local incomes haven’t been above the national average since 2000. The rapid rise in the cost of living is fairly recent — the local cost of living was 92.6% of the national average in early 2016; it is now 100.9% of the average.
Local incomes grew the slowest among Colorado metro areas last year and ranked 304th among the nation’s 380 metro areas in income growth.
Grand Junction led Colorado’s seven metro areas with growth of 6.4% to $44,935, while Pueblo had the lowest per person income, $39,511, despite a 5.3% jump in 2018.
Statewide, incomes grew 5.6% last year to $58,456, nearly $10,000 more than incomes in the Springs.
Colorado Springs lagged behind the state and nation in part because of population growth and a large influx of families with children. The higher the number of nonworking-age residents, the lower the average income.
The Colorado Springs area’s population grew 1.9% in 2018, or more than three times faster than the national average and about a third faster than the state’s 1.4% growth.
Nearly 20% of the area’s income growth came from government employees, with nearly half of that coming from the military. Other major contributors included the health care, professional and business services and construction sectors. The durable goods manufacturing sector reported the only overall decline in income — a $100 million drop, or nearly 11% from the previous year.
Income per person increased last year in all of the nation’s 380 metro areas with oil-rich Midland, Texas, and Odessa, Texas, taking the top two spots and growing at double-digit rates. El Centro, Calif., and Merced, Calif., ranked at the bottom of the list.
The agency calculates income per person by adding wages, salaries, business owners’ incomes, rental income, dividends, interest, pensions, welfare and other government payments and then dividing by the population of the nation and each of its metro areas.