Monday, November 15, 2004

Solano County salaries growing

By Matthew Bunk

FAIRFIELD - It appears salaries in Solano County have grown much faster than in the rest of the state during the past five years, while the county has lagged behind California in terms of new business growth.

Since 1998, business payrolls in the county rose 48 percent, almost double that of California's 22 percent payroll growth, according to a state Employment Development Department study released last week.

Payrolls in Solano County topped $1.1 billion in the third quarter of last year, up from $756.8 million in the third quarter of 1998, it stated.

But, despite that surge, the average salary of a worker in Solano County still trailed the state. Real per-capita income in Solano County in 2002 was $31,902, according to a different payroll study by the state Office of Transportation Economics.

Since the third quarter of 1998, Solano County has attracted a net total of 751 new businesses for growth of about 9 percent. It now has 9,140 businesses, most of them small companies with fewer than five employees, the EDD report stated.

Statewide, there were roughly 1.16 million businesses in the third quarter of 2003. That was 12 percent more than the 1.04 million operating five years ago.

According to the studies, average Solano County workers could be on track to make as much as their peers across the state, which historically have made considerably more money. While that might be good news to some, salary growth isn't the whole picture.

A healthy local economy also depends on a mix of service and goods-producing industries, as well as overall business size, said Dennis Mullins, a state labor market consultant for Northern California. Judging past trends, Mullins said Solano County appears to be headed in the right direction.

"With diversification of industry, you don't get the seasonal highs and lows in terms of unemployment," he said.

It's also desirable to have a wide range in business sizes because that helps create jobs for workers of all training levels, he said.

Of Solano County's 9,140 businesses, 500 of them employed more than 50 workers. Only eight businesses in the county had more than 1,000 employees.

Those numbers are fairly comparable to statewide, and eight very large businesses is pretty good for a county of Solano's demographic makeup, Mullins said.

"Eight businesses with more than 1,000 workers strikes me as a substantial number," he said. "And the rest of the businesses in the county seem to be relatively spread out in terms of size."

The Napa-Solano labor market was the only subregion in the Bay Area to create new jobs in 2002, a year in which jobs disappeared en masse across all many parts of the state. Non-farm employment grew 1.9 percent in Solano County in 2002, according to the OTE study.

One challenge facing Solano County, though, will be to continue growth in manufacturing businesses and employment as service industries have grown at a much faster pace in the past five years.

Service businesses have grown three times faster than goods-producing industries since 1998, according to the OTE study.

The real money-makers will be goods-producing businesses, Mullins said. Those industries tend to bring in more outside revenue than ones that provide services, he said.

"Some areas are headed toward all service producing," Mullins said. "And they've lost a lot of outside revenue from the loss of manufacturing."

Reach Matthew Bunk at 425-4646 Ext. 267 or

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