The addition of a mortgage and rising gas prices caused Sedro-Woolley resident Paul Brainard to cut back on spending, and he now “cringes” at grocery prices.

Although his job as a manager for a Bellingham-based professional society for engineers and scientists pays a “quite generous” wage, like a lot of Americans, Brainard’s looking to trim his expenditures. He’s postponed upgrading his SUV, which is one of the models that gets higher gas mileage.

“I’m a little bit more conservative about some of the impulse purchases,” said the 40-year-old. “I’m not making as many trips to the mountains or Seattle as much as I used to.”

Many residents of Skagit and Island counties are tightening the buckle on their personal budgets by concentrating on basics and forgoing frills to stretch their paychecks to meet the demands of higher prices and an uncertain economy.

Several Skagitonians shopping Monday in Burlington and Sedro-Woolley indicated that for many, wages aren’t keeping pace with rising costs. The trend appears to be especially true when it comes to sacrificing other purchases in favor of filling the fridge or gas tank.

Residents told the Skagit Valley Herald that they are hitting second-hand stores, clipping coupons and watching for grocery sales. A few said that they were grateful to have a job or happy that an unemployed relative was able to find work.

Northwesterners are facing the same challenges as other Americans: An economy rocked by the housing bubble’s burst, the mortgage crisis, the loss of at least 400,000 jobs nationwide and a sharp spike in energy costs — 25 percent since the middle of 2007.

But a recently released report from the Economic Policy Institute indicates that for almost 10 years, many middle-class Americans’ wages haven’t kept pace with inflation.

Also, wages didn’t rise with the economic growth experienced by employers from 2000 to 2007, according to the “State of Working America, 2008/2009.”

The nation’s productivity grew 11 percent from 2000 to 2007, but wage growth was about 3 percent, according to the institute, which is a Washington, D.C.,-based think tank with ties to labor groups.

Whatever the cause of the nation’s economic woes, Sedro-Woolley housewife Shelby Jones said she’s grateful that her husband will start a new job as a sandblaster. As a construction worker specializing in heavy-duty jobs, the unseasonably wet summer dried up many of his employment opportunities.

In the interim, the family was frugal, and for the first time in their 13-year marriage, the couple turned to the state for assistance, Jones said.

“You just buy the basics and try to feed the kids as healthy as you can,” Jones said. “There’s no room for saving.”

Things could be worse, and by some economic measures, the job market is pretty good, said state employment experts.

Skagit County’s July 2008 unemployment rate of 6 percent and the state’s 4.4 percent are the lowest in 15 years, said Joe Giannamore, a regional economist with the Washington State Employment Security Department. The national rate is 5 percent, according to the state employment security. However, the state and federal unemployment figures don’t include people who aren’t receiving benefits or aren’t looking for work.

This year, Skagit hasn’t had to deal with large layoffs, such as the one that hit Island County this past November when Nichols Bros. Boat Builders closed, Giannamore said. As a result, Island’s job market is weathering a net loss of 88 manufacturing jobs.

Also, the pending closure of Rosario Resort in October will mean the loss of 100 year-round jobs and 95 seasonal positions in San Juan County, Giannamore said.

The resort will be auctioned at the end of the month, according to the Puget Sound Business Journal.

“It’s a sluggish economy right now, and Skagit County is reflecting that more so than anything else,” Giannamore said.

In Skagit County, job growth overall is slightly less than the 1 percent increase statewide from July 2007 to July 2008. Growth in the leisure and hospitality sector and in state government in Skagit offset job losses in manufacturing and construction, according to state statistics.

But in Island County, a total of 30 jobs were lost from last summer to this summer with small gains in other categories offsetting losses in manufacturing and construction.

Brian Humphrey, WorkSource administrator for Northwestern Washington, said most area residents seeking work are finding it, and the regional job market compares favorably to other areas of the state or nation.

“While it is challenging, it’s not bad at all and not as bad as it was historically, in the ’90s and early 2000,” Humphrey said.

Self-employed interior designer Patricia Meinzer of Mount Vernon said her business is slower than usual because customers tell her they are postponing major purchases or redecorating.

“I think I feel lucky to hold a job,” Meinzer said. “I think they are cutting back to buy groceries and gas, making do with less.”

After nine months, Des and Barbara O’Neill, 72 and 70, just sold their Seattle home in anticipation of moving full-time to their second home in Mount Vernon. Soon, they won’t have two sets of utility bills. But the couple said they expect to still keep their eyes open for the least-expensive gas prices and will peruse the grocery store ads to find the best food deals.

“It’s gotten scary,” Des O’Neill said. “We have two houses right now.”

Still, not everyone seems worried about how their income stacks up against rising expenses.

“We have a whole group of friends who have RVs, but we don’t ever hear them griping about gas,” Barbara O’Neill said.

* Marta Murvosh can be reached at 360-416-2149 or .