THE PINCH: Raises expected to be smaller in '09

Colorado Springs residents trying to make ends meet better get ready for more belt-tightening: Local employers are projected to dole out smaller raises in 2009 compared with this year.

The real eyebrow-raiser, though, is that for the second consecutive year, local companies will give the lowest pay hikes in the state, according to two recent market assessments.

A survey released ThursdaySept. 18 by Mountain States Employers Council projects an average 3.2 percent salary increase in 2009 for local workers, compared with a statewide projection of 3.6 percent.

A local economist predicts even leaner paychecks. Fred Crowley, senior economist for the Southern Colorado Economic Forum, forecasts a 2.9 percent average wage increase in the Colorado Springs market next year, an entire percentage point below an expected statewide increase of 3.9 percent.

"It's pretty terrible, actually," Crowley said MondaySept. 22. "We are failing to observe any growth in high-paying jobs of significant levels. There's still growth in jobs - but they are all in lower-level pay areas, such as service and retail."

Blame the economy, which Crowley believes has slipped into a recession with the latest job loss and unemployment figures, coupled with slowing retail sales and a high number of foreclosures.

"We don't have confidence that next year will be a strong wage year," he said.

Results of the Mountain States Employers Council survey "reflect the tight economy in southern Colorado," said Patty Goodwin, director of surveys for the Denver-based nonprofit organization, which assists 2,800 businesses around the state with human resource issues and operates a Colorado Springs office.

Colorado Springs' industry base also plays a role in the gloomy forecast, she said. The city has more than 800 nonprofits, which Goodwin said typically pay less than private-sector employers.

And Colorado Springs does not have the state's two most booming sectors, ski resorts and oil and gas development, Goodwin said.

Local companies that are doing well, though, might be able to be more generous.

Ramtron International Corp, a Colorado Springs-based semiconductor company, handed outs its typical raise of 3 to 5 percent this year, and probably won't change its policy next year, said Lee Brown, vice president of business development.

"Our business is growing over 20 percent per year, and the company has become more profitable. From that perspective, it's a little easier to justify," he said.

Goodwin said the news about pay raises is "not all bad." If local employers follow through with their projections, next year's 3.2 percent increase will equal the Colorado Legislative Council's projected inflation rate for Denver - a comparable indicator for Colorado Springs, she said.

And only 5 percent of the 619 businesses her organization surveyed - including 59 from Colorado Springs - said they anticipate giving no raises at all next year.

But workers affected by declining pay boosts aren't happy to hear the forecasts. Betty Jackson, who was taking a break from her job at a human services agency MondaySept. 22, said her company gave employees a raise this year but then rescinded the decision, citing economic difficulties.

"I just got a letter saying the phone company wants to increase its rates. The trash company is raising its rates. And my salary doesn't go up. A little raise to meet the bills and send some sort of recognition to employees would be nice," Jackson said.

"But at least I have a job."

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Contact the writer: 636-0235 or debbie.kelley@gazette.com