2019-151 Economic Impact of City of Denton as an EmployerDate: August 2, 2019 Report No. 2019-151
INFORMAL STAFF REPORT TO MAYOR AND CITY COUNCIL SUBJECT: Economic impact of the City of Denton as an employer on the local economy EXECUTIVE SUMMARY:
This ISR provides information on the average wage, median wage and wage distributions for employees in the City of Denton and comparisons with Denton County average and median wage. This request was part of a Council discussion on a living wage for contractors, which is not addressed in this ISR.
BACKGROUND: The Denton labor market is comprised of a broad array of businesses and industries. Table 1 provides the businesses and institutions, that employ 950 or more people, which comprise Denton’s top 10 major employers. Denton is home to several corporate, regional and international headquarters as well as central distribution facilities. Some of the most notable businesses include:
Peterbilt Motors Company, Sally Beauty Company and Target. More than 4,500 companies have chosen to do business in Denton with small, medium, and large businesses operating in a multitude of industries. Table 1: Top 10 Major Employers in Denton
No. Company Name Description Type Employees
1 FEMA-TX National Processing Service Center National Processing Center for FEMA – Region 6 Public 594 constant up to 1,100
2 University of North Texas Higher Education Public 4,614
3 Denton Independent School District Education Public 4,417
4 Peterbilt Motors Class 8, Medium Duty Trucks Private 3,075
5 Texas Woman's University Higher Education Public 1,875
6 Denton State Supported Living Center Provide services for people with Intellectual Disabilities Public 1,700
7 Denton County Local Government Public 1,681
8 City of Denton Local Government Public 1,503
9 Texas Health Presbyterian Hospital Denton Healthcare Private (nonprofit) 1,076
10 Medical City-Denton Healthcare Private 950
10 Sally Beauty Company Distribution of professional beauty supplies Private 950
Sources: Denton Chamber of Commerce and City of Denton City of Denton Wage Distributions Table 2 and Chart 1 provide the City of Denton wage distributions for full-time employees. The majority of City employees fall into the $50,000 to $74,999 category. Roughly one-third each comprise the $25,001 to $49,999, $50,000 to $74,999, and $75,000 to $99,999 categories.
Date: August 2, 2019 Report No. 2019-151
Table 2: City of Denton Wage Distributions
Category Number
$25,000 and Under 33
$25,001 to $49,999 420
$50,000 to $74,999 467
$75,000 to $99,999 390
Above $100,000 193
Total 1,503
Source: City of Denton Human Resources Department Full-time equivalent not included Chart 1: City of Denton Wage Distributions
Source: City of Denton Human Resources Department Wages
The average and median wages in Denton County are presented in Table 3. The average and
median annual wages in Denton County are $46,052 and $37,000, respectively. Table 4 provides the average and median wages for the five categories in the General Pay Plan with the City, which excludes “director and above” salaries. Exempt comprises the majority at 69% and Non-exempt accounts for 31% of the General Pay Plan. Table 5 includes the Executive City of Denton average
and median wages. All of these positions have exempt status.
Table 3: Denton County Average and Median Wages
Salary Average Wage Median Wage
Annual $46,052.00 $37,000.00
Hourly $22.14 $17.79
Source: Jobs EQ
2%
28%
31%
26%
13%
$25,000 and Under $25,001 to $49,999 $50,000 to $74,999
$75,000 to $99,999 Above $100,000
Date: August 2, 2019 Report No. 2019-151
Table 4: City of Denton General Pay Plan Average and Median Wages
Average Wage Median Wage
Category Number of Employees Annual Hourly Annual Hourly Exempt Labor 226 $43,888.00 $21.55 $44,824.00 $21.55 No Clerical 174 $41,392.00 $19.00 $39,520.00 $19.00 No Technical 227 $46,508.80 $22.09 $45,947.20 $22.09 No Professional 120 $74,452.12 $32.87 $68,369.87 $32.87 Yes Supervisors 161 $85,225.83 $39.14 $81,411.20 $39.14 Yes Source: City of Denton Human Resources Department Note: numbers do not include director level and above salaries. Some of the above categories include positions paid in other funds including DME and Technology Services.
Table 5: City of Denton Executive Average and Median Wages
Average Wage Median Wage
Category Number of Employees Annual Hourly Annual Hourly
Directors 14 $151,462.21 $72.82 $150,000.00 $72.12
General Managers 2 $196,838.75 $94.63 $196,838.75 $94.63
CFO and up 3 $202,666.67 $97.44 $208,000.00 $100.00
Source: City of Denton Human Resources Department Note: does not include First Assistant City Attorneys and Council appointees Labor and Sales Tax Impacts There are a number of factors not comparable between public and private entities. The City of Denton is a public employer and does not have a private employer comparable in the number of employees, so an apples to apples comparison cannot be made between the City and major private
employers. It is not comparable to include the City’s investment in real and business personal
property, as City property is tax exempt. This report focuses on the direct and secondary labor and sales tax impacts from the City of Denton using Total Impact 2.0, by Austin-based Impact Data Source. This economic development modeling tool is used to perform economic and fiscal impact analysis.
Table 6 provides the direct and ripple effects from indirect and induced jobs created as a result of the direct jobs. The table also includes the estimated taxable sales from the direct and ripple effects of the labor. The City of Denton currently employs 1,503, which is the direct labor impact. The secondary impact of indirect and induced jobs created from the direct jobs is 1,331.3, which is a
total of 2,834.3 jobs generated from the City. These ripple effects include the goods and services
provided to the City and City employees purchasing goods or services in Denton. For example, the City may buy paper from a local suppliers and may use consulting services from local company. City employees may also increase business at a nearby restaurant causing the establishment to hire more employees.
Sales taxes generated as a result of the employees in the City of Denton is estimated to generate sales tax revenue of $1,644,224 to the City and $669,036 in to the Denton County Transportation Authority (DCTA) over a ten-year period.
Date: August 2, 2019 Report No. 2019-151
Table 6: City of Denton Economic Impact Summary
Direct Ripple Effects Total
Jobs 1,503.0 1,331.3 2,834.3
Salaries $912,300,000 $549,230,000 $1,461,530,000
Taxable Sales Tax Receipts $68,422,591 $41,192,316 $109,614,907
CONCLUSION The City of Denton is a major employer, economic and financial generator that contributes to the local economy. This report provided the average wage, median wage and wage distributions for
employees in the City of Denton and comparisons with Denton County average and median wage. The report focused on the direct and secondary labor and sales tax impacts from the City and major employers in the community. There are a number of factors and economic drivers that are not comparable between public and private entities, industry codes among these entities and the disparity in the number of employees. The Total Impact 2.0 model is also not designed for public
institution analysis. Key components of impact analysis include the investment of a project and the estimated ad valorem and or sales tax revenue that would be generated as a result of the project locating or expanding in Denton. It is not comparable to include the City’s investment in real and business personal property, as City property is tax exempt. The City does invest in roads, libraries, public safety, utility and other services, but there is not a comparable service that the private
industry provides, nor can this report address the demand on government services. STAFF CONTACTS: Erica Sullivan Economic Development Analyst
940-349-7731 Erica.Sullivan@cityofdenton.com Jessica Rogers Director of Economic Development
940-349-7531 Jessica.Rogers@cityofdenton.com
REQUESTOR: Council Member Armintor
PARTICIPATING DEPARTMENTS: Economic Development, Human Resources and
Finance STAFF TIME TO COMPLETE REPORT: The estimated amount of cumulative staff time to complete the report and associated analysis is 23 hours.