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Lower-income workers lead Orlando’s wage growth

ORLANDO, Fla. — Central Florida’s service workers and others typically categorized as “lower income” have seen the biggest earnings gains since the pandemic began, according to a report by researchers at ADP.

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From 2019 to 2021, workers in the 5th percentile of earnings saw their take-home pay rise by 13.45%, a stunning turnaround from pre-pandemic years, where wages fell by 0.8%.

Workers in the 95th percentile of earnings saw their wages rise 8.21%, from 7.46% pre-pandemic.

Part of that strong growth among lower-income workers may be because Florida passed a voter-led initiative, gradually raising the minimum wage annually from $10 per hour to $15 per hour. However, Orlando was part of a national pattern that saw bigger gains among the bottom in relatively inexpensive cities. In more expensive cities like Washington, D.C., higher-income workers came out on top.

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The research team theorized that more older workers were able to retire and stay out of the workforce during the pandemic in less expensive areas, and some people decided to quit their second or third jobs. That forced businesses to compete for workers they may have previously considered easily replaceable.

“These people realized, wait, you know, work wasn’t paying that much, we’re actually doing OK with these other ways of getting by,” MetroSight economist and ADP research fellow Issi Romem said.

Romem’s team also found that while high- and low-income workers gained, those in the middle didn’t have as much to celebrate. The median wage in the Orlando area rose 6.4% over the past two years, maintaining its pre-pandemic rate.

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He also discovered that national trends were putting Florida into a better position against its wealthier counterparts, like California, for attracting blue-collar workers, since the cost-of-living gaps were growing wider.

“That math that is tilted against the expensive coastal cities and in favor of places like Florida is getting even more tilted,” he said.

But within Florida, the numbers weren’t even. Wages across the Orlando metro area grew at a slower pace than the state’s three other big cities.

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Nilda Blanco, of CareerSource Central Florida, said her organization’s experiences locally matched the research team’s findings and offered an explanation: Orlando’s workforce is different, with service workers making up a much bigger percentage of the labor force.

“Entry level workers or roles,” she said, “Those wages are going to look different and show up differently in the data. Whereas you may be looking at Jacksonville, they may have a larger financial industry.”

Blanco predicted that wage growth patterns would change as Orlando’s workforce continues to diversify. Already, banking and office-type roles are vying for the biggest percentage of labor in the area.

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Blanco and Romem said job and skills training would be crucial to maintaining a middle class over the coming years and decades. Romem also blasted Florida’s housing policy, which he said had been too slow to change and still encouraged sprawling developments rather than smarter, transit-oriented urban cores.

“Life is becoming extremely difficult for low wage earners,” he said. “Florida hasn’t had that problem yet to the same extreme, but it is probably in its future.”

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