Slight upward pressure appears to be building on the amounts Spokane-area employers pay both to lower-paid workers and to more highly paid technology workers.


Jeff Zahir, the Washington state Employment Security Departments Spokane-based regional labor economist, says he has detected the growing pressure on wages, particularly at the lower end of the pay scale.


Where Im getting my information is from interviews with employers and the employment numbers that we get here locally, Zahir says. I unfortunately cannot publish my most recent data yet because it hasnt been checked by the folks in Olympia and revised and vetted.


He expects to be able to show in reports, perhaps as soon as July, that those trends toward higher pay are occurring.


Even though the minimum wage went up to $7.35 an hour, from $7.16 an hour, in Washington state on Jan. 1, the trend he has seen toward higher wages for lower-paid workers exceeds increases that would be explained by that increase, Zahir says.


Still, he says, the upward trend in wages is not profound thus far.


Im very interested in following this, Zahir says. I suspect that there is upward pressure on wages because of the shortage of unskilled labor in Spokane.


He adds, Im seeing it on two ends of the pay scale, at the ISRs (Isothermal Systems Research Inc.), the Liberty Lake technological businesses, as well as at the low end.


Last month, Spokane headhunter Jeannine Marx said she had noted a change in the pay of high-tech people here.


Because of the technical level of expertise now required of people in the high-tech industry here, individuals are being compensated at more of a national scale, Marx said. Last year, I couldnt have said thatit was more of a regional scale. Thats very significant.


Zahir says that businesses such as cabinetmakers, window makers, interior design businesses, and furniture retailers havent been able to find certain kinds of employees recently.


He says furniture retailers have told him, Were selling every stick of furniture we get, but we need to hire a new salesperson, and we cant find one.


Call centers and temporary-help agencies have rounded up basically everybody in Spokane who can pass a drug exam and will show up for work, Zahir says. Other people who hire are having to increase their wage levels to attract workers. For them to offer higher wages, there has to be a good reason to do that.


The upward pressure comes after an almost six-year period in which increases in wages paid here lagged behind increases in the cost of living in the Western states, Zahir says.


During that period, from 1999 through the first three quarters of 2004, Spokanes average wages went up by an average of 1.97 percent a year, while the U.S. Western Urban Consumer Price Index climbed by an average of 2.17 percent a year, Zahir says. That index covers everything west of the Mississippi, including Hawaii and Alaska, he says.


Spokane has really suffered, what with the loss of manufacturing, Kaiser, and all of that, Zahir says. Kaiser Aluminum & Chemical Co.s Mead Works aluminum smelter is being dismantled after closing earlier, and the manufacturing sector here has undergone cutbacks.


Employers, meanwhile, are facing increases in the Producer Price Index, which measures the prices of a basket of goods needed by a manufacturing business, service business, or business services concern, and increases in the Employment Price Index, which measures the costs of employing people, Zahir says.


If I were a business owner studying how I was going to grow my business, boy, would I be hard pressed to make a choice between adding labor expenses or other costs, Zahir says.


He says he uses the two national indexes to track changes in costs because the factors that are causing cost increases are national in nature. For example, employees still have to buy gas at the local gas station, and its going to be 4 percent or 5 percent more, he says.