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Less pay is more here for some jobs

If you’re a prison guard or a plumber, the Buffalo Niagara region is the place to be.

If you’re a lawyer, a computer wizard or an engineer, this isn’t the most enriching place to work.

New data from the federal government found that the average wages in the Buffalo Niagara region were 7 percent less than the national average, with workers here earning an average of $21.05 an hour, compared with $22.71 an hour nationally.

The new report shows that the 7 percent gap between earnings here and the rest of the country hasn’t changed since 2012 – the last time the federal government issued comprehensive earnings data for more than 600 different occupations.

It also shows that earnings have been growing at a glacial pace, rising by just 2.5 percent during that two year period.

Even worse, consumer prices have gone up by about 3.5 percent during that same period, so at the end of the day, the purchasing power of those wages really has gone down by about 1 percent over the past two years.

But if you take a close look at the data from the Bureau of Labor Statistics, you’ll see that some occupations in the Buffalo Niagara region pay a lot more than the national average, while others pay quite a bit less.

The workers that fare the best, compared with their counterparts across the country, are in the production, protective services and construction industries. The ones who fall way short do computer, legal or engineering work.

“It isn’t necessarily a bad thing,” said Fred Floss, a SUNY Buffalo State economist.

“The cost of living plays an important part,” Floss said. “A person in Western New York can afford to take a little bit less.”

In general, a lot of the wage differential also comes down to basic supply and demand, and our job market has been growing more slowly than the rest of the country for decades. A tight market for a particular skill breeds higher wages, while employers can pay less when they have a stack of 100 resumes from qualified candidates for just a handful of open jobs. Employers in higher cost areas also have to pay higher wages to keep workers.

“If you went downstate to New York City working for Buffalo wages, you’d starve,” said George Palumbo, a Canisius College economist.

Lower wages in a particular industry also can be a regional advantage, making Western New York more attractive to businesses centered in higher-cost areas. That’s partly why finance and insurance companies, from GEICO to Citibank, have launched major expansions here. And it explains why the number of finance and insurance jobs in Erie County grew by almost 7 percent from 2001 to 2012 – a period where the sector was shrinking by more than 1 percent nationally.

“We are growing in the areas where we have a competitive advantage, and the competitive advantage is lower wages,” Palumbo said.

“The companies gain by moving work here because they can pay lower wages than in places like New York City and Chicago,” he said. “And we win because it moves jobs here that pay more than the national average.”

Some workers fare better than others. Plumbers and pipe fitters, for instance, earn an average of $56,320 a year here. That’s a whopping 38 percent more than the national average. Corrections officers, who take home an average of $62,830 a year here, are paid 40 percent more than their colleagues across the country.

This also is a good place to be a police officer. They earn an average of $64,850 a year here – 9 percent more than the national average.

It’s a similar story for teachers – provided they’re one of the lucky ones who have full-time jobs and aren’t in danger of losing them as enrollment drops and budgets get tighter. The $59,7500 that the average elementary school teacher here earns and the $60,370 that a middle school teacher earns on average both are 5 percent more than the national averages. High school teachers top the national average by 3 percent, earning $61,120 a year here.

And in a nod to our slow-but-steady housing market, local real estate agents earn an average of $59,450, or 7 percent more than the national average.

For the most part, though, workers here earn less than the national benchmark. Of the 22 major occupational groups singled out in the federal study, 16 of them paid less than the national average in the Buffalo Niagara region, said Martin Kohli, the chief regional economist for the Bureau of Labor Statistics.

The gap was especially wide for people in the legal, computer and engineering fields, although those workers still earn well above the $43,790 average annual pay in the Buffalo Niagara region.

Lawyers here earn an average of $96,660, or 28 percent less than the national average.

Computer programmers earn an average of $67,670 a year here, which is 18 percent less than the national average. Computer analysts fare only a little better. Their $75,530 average pay is 14 percent below the national norm.

Engineering jobs also pay well here, just not as much as other places. Mechanical engineers here earn an average of $74,610, or about 14 percent less than the U.S. Chemical engineers make roughly double the local average, but it’s still 15 percent less than the national average. For electrical engineers, the $83,760 they make here is 13 percent less than their colleagues across the country. Industrial engineers, on average, make about 10 percent less, earning $76,950 here.