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Market forces are at work in determining state wages.
Story by Beth Gorczyca Ryan
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Love living in West Virginia? Well, that love may be hurting the pocketbook.
For the most part, white-collar professionals working in West Virginia such as nurses, high-tech workers, finance professionals and teachers earn thousands of dollars less each year than what they would be making if they took an identical job just across the state's border, according to the most recent information from the U.S.Bureau of Labor Statistics.
Blue-collar workers fare a little better, but they typically earn less in West Virginia than the national average.
If West Virginia wants to grow its population and economy, these jobs are the types of professions the state needs. However, with pay significantly lower in many of these careers, it can be hard to not only grow the jobs, but to find workers to take them.
Marshall University economists Cal Kent and Kent Sowards said there are five main reasons why wages in West Virginia are lower in so many employment sectors:
Businesses in states outside of West Virginia have more market competition than those operating inside the Mountain State. When a state has a bigger pool of applicants for jobs, both the companies and the potential employees can be pickier. That raises wages.
West Virginia lacks Fortune 500 companies' headquarters. That leaves a hollow space in our economy where top managers and CEOs should be. Instead, we have middle managers that make less money, thereby bringing down average salaries in specific areas.
Although the state has made some progress in improving citizens' educational levels, West Virginia still ranks near the bottom in terms of residents who have a college education, advanced degrees and high job skills. Higher education levels directly correlate to higher income levels.
West Virginia isn't home to any major metropolitan areas. Metro areas, such as Pittsburgh and Columbus, have higher costs of living, which result in higher pay for workers.
So if employers in the state simply raise wages, will it help West Virginia attract the people it wants and retain the people it needs?
It's not that easy, said Kent.
"The market sets the wage," he said. "It's not something people just pick out of thin air. There is a pretty clear horse and cart here. When there is a demand for a type of worker, the wages go up.
"That's what we are seeing in the coal industry right now. Demand for coal has increased, the need for workers has increased, and the market is responding. When the market goes up, wages go up."
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