Provo women earn some of the lowest salaries in the largest U.S. Metropolitan Areas

Women in Provo have some of the lowest average salaries in the country, according to a Forbes analysis of the 2010 American Community Survey by the U.S. Census Bureau. Provo women are making on average less than $37,000 a year, according to the report. Provo women are making on average less than $37,000 a year, according to the report. Deseret News

Note:
Since I am interested in women's labor force issues and don't usually look at this type of data below the statewide level, I took the opportunity to look at the actual Forbes article. Forbes  used 2010 American Community Survey data for "large" Metropolitan Statistical Areas (MSAs) and focused on females working year-round and full-time. Unfortunately for comparative purposes, Forbes doesn't tell us what they considered a large MSA.

With median female earnings for year-round, full-time workers of $31,400, the Provo/Orem MSA ranks 249 out of 374 MSAs nationwide. Incidentally, the "smaller" MSAs of Logan and St. George showed lower female median earnings ($27,100 and $26,700, respectively). Other large Utah MSAs appear higher in the rankings--Salt Lake ranks 154, while the Ogden/Clearfield MSA ranks in the 200 spot.

However, keep in mind that areas with low female earnings might also have low earnings for both genders. In other words, an MSA's low female earnings may be reflected in low male earnings as well. Cost of living, age of the labor force, industrial mix, etc. affects wages generally. . .not just for women. In my mind, the true question perhaps should be: How do men and women's earnings compare in Utah's most populous communities?

In 2010, U.S. median earnings for women working year-round, full-time measured 78.6 percent of the comparable male figure. (This wage gap has contracted decidedly in recent decades.) How do Utah's MSAs stack up? Honestly, not so great. The Ogden/Clearfield MSA shows a female/male wage ratio of 63 percent, the Provo/Orem MSA shows 65 percent ratio. Logan's ratio measures 70 percent, and St. George's figure is 71 percent. Even in Utah's best MSA performer--Salt Lake City--the female median wage measures only 74 percent of the male median wage. More than 70 percent of the nation's MSAs show female/male wage ratios better than Salt Lake City.

What's up? Why the low female-to-male wage rations in Utah? Undoubtedly many factors come into play. However, one major influence on the large difference in wages seems to come to the forefront. I call it the "education gap" and it is a primary factor behind Utah's larger-than-average wage gap. Statistically, there is a well-know relationship behind one's earnings and one's education. In general, the higher a person's level of education, the higher their earnings.

What's the education gap? By my reckoning, it is simply the percentage point difference between the share of the male population (over 25) with at least a Bachelor's degree and the share of the female population (over 25) with at least a Bachelor's degree. Nationally, there is a six-tenths of a point difference in the share of men and women with at least a Bachelor's degree (28.5 percent and 27.9 percent, respectively). In other words, in the U.S. there is currently very little difference between the share of men and women with a four-year degree or better.

The three MSAs with the largest male/female education gap in the nation? Number 1--Provo/Orem, Utah (11.3 percentage points). Neck and Neck for the number 2 spot--St. George, Utah (9.8 percentage points) and Ogden/Clearfield, UT (9.8 percentage points). Logan's performance is somewhat better--"only" a 4.2 point difference. The Salt Lake MSA managed the smallest Utah education gap--still large at 2.5 percentage points. Every single Utah MSA ranked among the 20 percent of MSAs with the largest education gaps.

Keep in mind that in 40 percent of the nation's Metropolitan Statistical Areas, a higher percentage of women have obtained a Bachelor's degree than have men. If Utah's women are falling far behind men in educational attainment, it should come as no surprise that they are falling far behind men in earnings.

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Has Utah's housing bubble deflated yet?

Housing bubbles aren't like most price bubbles. Typically, speculation drives up prices (of stocks, crude oil, and back in the 17th century even tulips) like an expanding bubble. Eventually, it becomes obvious that item is extremely over-valued and prices "pop" and collapse. Yes, that's why we call them bubbles.

Remember a couple of years ago when gasoline prices went through the roof? You can blame a bubble market in crude oil. (Some SEC reports indicated that 80 percent of crude oil trading during the height of that price expansion was speculative.) In just seven months, the producer price index (seasonally adjusted) for crude oil went from 339.9 to 108.8. That change represents a decrease of almost 70 percent! Talk about a popping bubble. (And, you might want to note the similarity to the current price increases in oil/gasoline.)

On the other hand, housing bubbles tend to slowly deflate rather than pop. Why? Think about it. If you bought a home at the height of the bubble for $400,000 do you really want to sell it for $250,000? No. Most private individuals aren't able to afford that kind of loss. For many American families, a home is their largest asset. So, if you must sell, you will keep trying to sell at a higher price until the market makes it clear that just isn't going to happen. In other words, home prices are sticky downward, so it will take longer for home prices to deflate after the speculation ends.

It also becomes readily apparent why there is such a foreclosure mess in this country. Obviously, many home-buyers took out loans they couldn't afford in the long run. Then, the recession exacerbated other home-buyers' ability to pay. In addition, even if home-buyers can afford to make their payments, aren't the incentives skewed towards walking away rather than paying off the $400,000 mortgage on a home that is now worth only $250,000?

Well, this housing bubble has certainly taken its time collapsing. However, the market is working her magic and there does seem to be light at the end of the tunnel--at least according to the Federal Housing Finance Agency's Housing Price Index (HPI). (For more information on the HPI see this previous post or the Agency's website.)

(Click on image to enlarge.)

The chart that accompanies this posting certainly provides a lovely portrait of a housing market bubble for Utah's Metropolitan Statistical Areas (MSAs)--particularly for my own Washington County. You can watch home prices explode and then collapse (the chart shows the percent change compared with the same quarter a year ago--which eliminates seasonality).

The Logan, UT MSA (Cache County) seemed to participate the least in the run up of home prices and also appears closest to the end of the price declines. As of fourth quarter 2010 (the most recent index available):

• Logan home prices are down only 1.0 percent compared with prices in fourth quarter 2009.
• Ogden-Clearfield MSA home prices are down 1.8 percent.
• Salt Lake City MSA prices are down 2.0 percent.
• Provo-Orem MSA prices are down 2.4 percent.
• St. George MSA prices still show the largest price declines--4.8 percent.

However, for all MSA the price declines are getting smaller and smaller. The market is making her adjustments. In fact, given current trends, most if not all of Utah's MSAs are poised to see the end of home price declines in 2011.

Home prices hit post-bust lows in most big cities

Home prices in a majority of major U.S. cities tracked by a private trade group have fallen to their lowest levels since the housing bubble burst. The Standard & Poor’s/Case-Shiller index fell in December from November in all but one of the 20 cities it tracks. The 20-city index declined 1 percent.

The only market to see a gain was Washington, D.C. Along Utah’s Wasatch Front, according to a Jan. 27 report, the residential real estate market, mired in one of the worst downturns ever, is showing a few signs of improvement.

In Salt Lake County, 1,934 existing single-family homes were sold in the fourth quarter of 2010, down 21 percent compared with the fourth quarter of 2009, according to the Salt Lake Board of Realtors. The median selling price was $215,000, down 4.4 percent from the same three-month period in 2009 and off a peak of $256,000 in the summer of 2007. Salt Lake Tribune

Note: The Federal Housing Finance Agency also publishes the Housing Price Index for all Metropolitan Statistical Areas (MSAs). The following chart shows the year-to-year change in the index for Utah MSAs. The most current index is for third quarter 2010. A bottom to housing prices according to this chart would occur when the year-to-year is equal to zero. At this point, the Logan, UT MSA is closest to a bottoming in prices, followed by the Ogden-Clearfield MSA. Not surprisingly, these two areas experienced the lowest level of speculation in the housing market. You can access this information at: http://www.fhfa.gov/Default.aspx?Page=14

A Look Back at Logan

LOGAN — If St. George is the Dixie "hot spot" of Utah, then Logan is the pastoral "cool spot," given its northern, mountainous location and agricultural history in the Beehive State.
Agriculturally rich Logan's more than 140-year history has been well chronicled in the Deseret News over the decades.
From the home of a land-grant university, Utah State University, to the gateway to Logan Canyon and Bear Lake, Logan is a strategic and dynamic Utah community.