The tax data show that a shrinking segment of the region’s tax base is earning $40,000 or less, and the share of upper-income taxpayers in all local counties has more than doubled in the last decade.
“It’s shrinking, because people are doing better,” said Rea Hederman Jr., executive director of the Economic Research Center at the Buckeye Institute, a conservative-leaning think tank.
But Wendy Patton, senior project director with the left-leaning Policy Matters Ohio, said far too many workers still make poverty-level wages, and the tax data doesn’t paint a rosy picture, especially when pay is adjusted for inflation.
Six of the 10 largest occupational groups in the state pay median wages that are so low that workers qualify for and need food assistance, she said.
“The Ohio economy has been headed in the wrong direction for millions of Ohio households,” she said.
Warren County has attractive tax rates and a robust housing market where the median home price is about $340,980 ― and the average price is about $18,000 higher than that, said Matt Schnipke, director of the Warren County Office of Economic Development.
Owning property in Warren County is a smart investment, he said, and various areas continue to see a residential boom.
More than two-thirds of Warren County residents work in office jobs that tend to be higher-paying, and many people are employed in management and professional services, he said.
“Warren County offers many employment opportunities, great schools and an abundance of quality of life assets,” he said. “It is a great place to live, work and play.”
Greene County has many high-income earners partly due to its educated workforce ― nearly half of residents have a college degree, said Eric Henry, Greene County’s director of development.
Wright-Patterson Air Force Base also provides a continuous pipeline of new talent to the region, as local active-duty military personnel retire or separate and join the civilian workforce, he said.
The county also has a thriving small business community, Henry said, and a labor pool with workers who have embraced careers in high-earning trades and advanced manufacturing.
“We are fortunate to have a variety of key industries including aviation, manufacturing, research and development, engineering, tech support, consulting, health care and education,” he said.
Greene County has some of the best schools in the region, a relatively low cost of living, short commute times to many employers, and a unique and vibrant mix of high-tech and rural characteristics, Henry said.
About 38% of tax filers in Warren County and about 43% in Greene County reported earnings of $40,000 or less in 2019, the tax data show. Warren County had the second smallest segment of lower-income earners in the state.
By comparison, more than half of tax returns filed in both Montgomery and Clark counties reported incomes at or below that threshold, and nearly half of filers in Butler and Champaign also fell into that category.
Tax data show that the share of tax-filers earning $40,000 or less has declined for multiple years in every local county. Meanwhile, the share of earners making more than $200,000 in every local county has more than doubled since 2009.
Ohioans’ incomes are growing, and the share of tax-filers in the Buckeye State who earn $40,000 or less is pretty close to the national average, said Hederman, with the Buckeye Institute.
About 50% of federal tax returns across the country report incomes of under $40,000, according to IRS data, and more than 5.6% of all U.S. returns report incomes over $200,000, compared to about 4.8% in Ohio.
But Hederman said Ohio is very affordable compared to its counterparts across the country, and the Dayton region in particular is cheaper than many other places.
Economic challenges remain, Hederman said, because some industries that lead in hiring have jobs of varying compensation and quality, and Ohioans need access to good-paying jobs. Policy-makers need to ensure there are opportunities for workers to improve their education and skills, such as through technical training at community colleges, he said.
But Patton, with Policy Matters Ohio, said workers in the state need a raise, especially since their purchasing power has barely budged in decades, when wages are adjusted for inflation.
In Ohio, the median wage in 2019 was $19.91 an hour for white workers and $15.17 for Black workers, and the wage gap has been getting worse since the late 1970s, she said.
For the last 15 years, Patton said, Ohio’s policies to encourage economic growth have focused on cutting taxes on the wealthy, instead of investing in services that benefit everyone, like making higher education more affordable and improving public schools.
Tax cuts in Ohio’s new budget will put sizable sums into the pockets of the wealthiest Ohioans, but it will have modest benefits for most people, she said.
Raising the minimum wage would help improve Ohioans’ earnings, she said, and the state should put more money toward classroom instruction in state colleges and universities to help bring down the cost of tuition.
Share of tax returns reporting incomes of $40,000 or less
Share of tax returns reporting incomes over $200,000