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Notes from the Field

Decisions Based on Facts, not Folklore

What wage does someone need to make in order to afford a 2-bedroom apartment in Northern Kentucky?

The views expressed in this report are those of the author(s) and are not necessarily those of the Federal Reserve Bank of Cleveland or the Board of Governors of the Federal Reserve System.

What wage does someone need to make in order to afford a 2-bedroom apartment in Northern Kentucky? Per the Affordable Housing Online website, one would need to earn $14.79 per hour, or $30,760 per year, to pay the $9,228 per year in housing costs. I learned how relevant this fact is after a meeting with Barbara Stewart, Director for the Local Workforce Investment Area in Northern Kentucky.

Barbara’s organization, The Northern Kentucky Workforce Investment Board (NKWIB), provides a unique partnership between public and private sectors to support education, economic development, and workforce readiness. Half of the group’s membership is from the business sector. The NKWIB drives the policy, direction and funding oversight for the local workforce investment system, using labor market data and statistics to determine how best to serve businesses and clients in the Northern Kentucky area.   During my meeting with her, Barbara told me her board members insist on using data vs. stories to support the decisions in their work plan. “Data is our organization’s lifeblood,” she said.

NKWIB assists various types of employers and accommodates a range of workers’ skill and education levels. Services, delivered through a sector approach, are provided primarily through six Kentucky Career Centers located in an eight-county region. Currently the key industries identified for economic development in Northern Kentucky are Advanced Manufacturing, Health, Information Technology, Logistics, Distribution, Services and Energy.

The Kentucky Career Centers are the foremost workforce resource for both businesses and job seekers. The centers help businesses meet workforce needs by connecting job seekers to current career opportunities. This is accomplished by working with businesses to: fill open positions; train incumbent workers; provide on-the-job training and apprenticeships; and assists with recruitment. A job seeker is assisted by a job matching system that enables employers to recruit locally, regionally or nationally. Technical training is provided in partnership with Gateway Community and Technical College. Employees are coached in many areas, including soft skills.

So, what does all this mean for the person who needs to make $14.79 per hour in order to pay for that 2-bedroom apartment? 

Using data provided by NKWIB to tell the story, consider the following scenario for a worker in the advanced manufacturing sector, a fabricator by trade with an average wage of $14.52 an hour: Using the career ladders advancement approach, this fabricator is eligible for additional training in industrial machine installers, repairs, or maintenance with Gateway College, NKWIB’s community college partner. It will take him or her 24 months to complete the training needed to advance from a fabricator position to an industrial machinist role.  Now the worker has the potential to make $25.10 an hour, which translates to $52,208 per year, an additional $21,448 per year. The result would be life altering not only for the worker but for his or her family; this worker is now in a position to not just rent a two- bedroom apartment in Northern Kentucky, but also possibly purchase a home in the community.  

According to NKWIB, in 2014 there were 3,067 fabricators in the Northern Kentucky area with an average wage of $14.52 per hour. For this same time period there were 842 Industrial Machinists with an average wage per hour $25.10. That’s a lot of potential workers moving up the career ladder, and a lot of potential home buyers for the northern Kentucky area.