Tuesday, October 10, 2006

Mass. Workers do more, but wages fall short

The Boston Globe reports:
Massachusetts workers are producing more than ever, and doing it more efficiently, but their earnings have barely budged since the end of the Dukakis administration, a Northeastern University study concludes.

The study, by Northeastern's Center for Labor Market Studies, found the state's median annual earnings, adjusted for inflation, have risen just $546 -- 1.2 percent -- since 1989. Meanwhile, productivity, or the amount produced by a worker in the same amount of time, soared nearly 50 percent in that period.

In other words, the typical employee is working harder, faster, and smarter, but getting few of the benefits, said Andrew Sum, the center's director and study's lead author. Historically, higher productivity has led to higher earnings after inflation. But globalization and other economic forces are breaking the link between productivity and wages, redistributing gains to consumers, corporations, and the richest workers.
What's the matter with Massachusetts?