Open Source: NC lists the average wages of incentive-funded jobs. But why not median pay?

I’m Brian Gordon , tech reporter for The News & Observer , and this is Open Source, a weekly newsletter on business, labor and technology in North Carolina.

Median, mode, mean and range. The staples of middle school math class come to mind each time I hear North Carolina award another company a multimillion-dollar economic incentive package. When the state backs a big jobs project, say Novo Nordisk expanding its Johnston County manufacturing plant, officials will publicize the project’s anticipated average salary. In the case of Novo Nordisk, the company in June pledged to create more than 1,000 jobs at an average wage of at least $69,000.

You may not need a statistician to explain why an average wage doesn’t always give a complete picture. But I found it helpful to ask one.

“The bottom line is, if they’re allowed to give a few people big salaries, they can definitely make it seem like the average is better than it really is,” said Dennis Boos, a professor in NC State’s statistics department.

Boos said a more illuminating metric is median, the midpoint of a distribution, where half the sample is above and the other half below. “The census and everybody does median family income,” he noted.

So why doesn’t North Carolina announce median wages when awarding its main incentive, the performance-based job development investment grant known as a JDIG ? In short, state statute does not require officials set median wages when evaluating projects for this incentive.

The N&O reached out to several companies that recently received JDIGs to ask for their project’s median wages. None shared. Lowe’s and Novartis , which each received incentives in 2019, declined to reveal their medians. Novo Nordisk and Fujifilm , which both got JDIGs this year to expand in the greater Triangle area, didn’t give their medians, either.

Before anyone screams conspiracy, companies are generally loath to divulge pay information they aren’t obligated to share. And while North Carolina has no firm median wage threshold for incentive-backed projects, N.C. Commerce spokesperson David Rhoades says the state is aware ahead of time if a company planned to elevate its proposed average wage with a relatively small number of high-salaried positions.

“When a company applies for its JDIG, they provide us a list of all the new job positions and the forecast wages for those positions,” he said in an email.

Rhoades added that median salaries are factored into the models North Carolina uses to recommend incentives. And when introducing jobs projects to the public, the Commerce Department includes the disclaimer “although wages will vary depending on the position.”

Take Lowe’s, which five years ago announced it would create more than 1,600 jobs at a new global technology center in Charlotte with an average salary of around $118,000. Rhoades said Lowe’s median wage on this project was $125,000, based on estimates at the time of the award.

But how about today? The home improvement retailer has already hired at least 1,000 workers under this grant, state records show. Has the median pay matched the state’s estimates from 2019? We don’t know. Lowe’s could still hire under this active grant, so it’s final median wage isn’t solidified.

Furthermore, while North Carolina can withhold grant payments if recipients fail to meet hiring, investment or average wage commitments, state law doesn’t tie this money to median. For a quick counterpoint, companies receiving South Carolina’s JDIG-like incentive typically only collect public money on positions that pay at or above the average hourly wage rate of the project’s surrounding county.

To be clear, I have no reason to think JDIG recipients are skewing their averages. And most North Carolina-backed projects never reach their initial jobs targets anyway — with about one in five not hiring at all. (The state only distributes JDIG dollars once companies meet their hiring and investment goals.)

Still, I believe it’s worth noting what a company receiving North Carolina taxpayer money could feasibly do with their wages. And that there are more figures to consider than the ones announced.

Yellen talks inflation, drives, and eats

After driving an electric car but before lunching at the legendary Sam Jones BBQ, U.S. Treasury Secretary Janet Yellen spoke Thursday at Wake Tech’s newest campus in Wendell. She was there to tout the Biden administration’s Inflation Reduction Act , particularly the multiple clean energy initiatives included in the wide-ranging 2022 law.

Yellen pointed out that inflation — a top voter concern — is down to around 3% compared to its dangerous 9.1% peak in June 2022. In response, the communications team of Republican North Carolina Senate Leader Phil Berger posted data later in the day showing home energy costs have risen markedly since 2020.

(Quick aside: This week I learned a lot of people are vested in with what Yellen eats when she travels.)

Following their remarks, Yellen and Gov. Roy Cooper held a brief joint press conference. The first question, asked by a Reuters reporter, caught my attention. He noted multiple reports that say President Joe Biden is prepared to block a $14 billion deal for U.S. Steel to be sold to Japan-based Nippon Steel . This potential acquisition is under a national security review as some fear what this merger could mean for America’s steel supply.

The deal’s fate is particularly relevant to a state at the heart of the 2024 election: Pennsylvania. U.S. Steel is headquartered in Pittsburgh, and its CEO has argued Nippon’s investment is crucial to keep the company’s older mills operating and their workers employed. But Biden, Kamala Harris and Donald Trump have all publicly opposed the merger. The United Steelworkers union also opposes it, fearing Nippon would cut unionized U.S. plants.

On Thursday, Yellen said she couldn’t comment on the merger’s prospects. Cooper was also asked his thoughts given that the largest U.S. steel producer, Nucor Corp ., is headquartered in Charlotte (and has several other facilities throughout the state).

“I think it’s pretty clear that both North Carolina and this administration have taken a lot of steps to secure foreign direct investment that in turn creates American jobs,” Cooper said. “And there’s really no better example than North Carolina when you look at the Toyota battery plant and other clean energy firms that have come to North Carolina to create these American jobs.”

Clearing my cache

• Top Tier Solar Solutions, The Woobles and DebtBook were the top North Carolina businesses on the 2024 Inc. Magazine list of the fastest-growing private U.S. companies. Each year, Inc. ranks the 5,000 (so few?) fastest-growing companies based on their revenue percentage growth over three years. To be eligible, candidates must also have annual revenues of at least $2 million.

At No. 19, The Woobles is the best performing Triangle business. This crochet company was founded by couple Justine Tiu and Adrian Zhang, who have continued to find success even after turning down a deal from Mark Cuban on “Shark Tank.”

• On Monday, the Japanese biotech company Kyowa Kirin will ceremonially break ground at its incoming manufacturing plant in Sanford. North Carolina Sens. Thom Tillis and Ted Budd are scheduled to attend.
• The prominent Durham chipmaker Wolfspeed had another rough week on the stock market, with its shares falling about 17%. On the year, the stock is down 80%. Its leaders hope for a comeback .

National Tech Happenings

• Brazil bans X , formerly Twitter. It is the latest development in the months-long feud between X owner Elon Musk and Brazil’s Supreme Court Justice Alexandre de Moraes.
• Tuesday was a day to forget for most stockholders, as the NASDAQ and Dow sunk. Reasons included a weak manufacturing report and a sell-off of the AI chipmaker Nvidia (which is still up a whopping 122% on the year).
• As a journalist, the internet archive Wayback Machine has been a godsend for accessing past webpages that otherwise wouldn’t be viewable. As more of the web goes offline, The Verge discussed the role this nonprofit plays in keeping information alive.

Thanks for reading!