Kitsap County had 2nd highest wage growth in the U.S.

Kitsap County wages grew faster last year than almost any other large county in the country, according to recent government data, but small businesses still must compete with higher-paying Seattle.

Details: The county west of Seattle saw wages jump 12.7% in 2022, behind only Midland, Texas, a key oil and gas hub where salaries increased 13.9%, Axios' Matt Phillips and Emily Peck write.

Why it matters: Higher wages are a boon for workers but a hardship for some small businesses struggling to compete with Seattle in a tight labor market, according to David Emmons, president and CEO of the Greater Kitsap Chamber.

What they're saying: Even after cutting into slim margins to lure workers back from Seattle, "there probably isn't a business in town that isn't looking for employees," Emmons told Axios.

Zoom in: Among key contributors to the county's wage growth was the increase in the state's minimum wage, Jim Vleming, a regional labor market economist with the Washington State Employment Security Department, told Axios. A ballot measure approved by Washington voters in 2016 ties minimum wage increases to inflation.

• Competition with King County for workers is also part of the mix, said Vleming.
• That's because the minimum wage in Seattle — which jumped to $18.69 an hour in January — is even higher than the current statewide rate of $15.74.

Kitsap County's largest employer is the federal government through Naval Base Kitsap, which employs thousands of military and civilian personnel.

• Inflation is also factored into federal wages, which have thus gone up, Emmons told Axios.

Yes, but: King County saw stronger wage growth than Kitsap from 2019 to 2021 — and King County's average wages still far surpass those in surrounding counties, according to ESD's most recent complete wage data.

By the numbers: In King County, the average wage rose from $93,300 in 2019 to $115,535 in 2021.

• In that same timeframe, Kitsap saw an increase from $53,945 to $61,475.
• Pierce wages rose from $54,270 to $61,135, while Snohomish wages increased from $63,480 to $69,120.

The big picture: The strong demand for workers drove Washington’s average annual wage up by 7.5% in 2021 to $82,508, the state's second-highest increase in more than two decades, according to ESD.