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August 04, 2003
Study: Average New England Worker 'Running in Place'
The typical full-time worker in New England was no better off in 1999 than he was ten years earlier in 1989 in terms of purchasing power of their earnings, according to new research from Northeastern University's Center for Labor Market Studies in Boston. In fact, the median worker in the region earned just $68 more in 1999 than he did just ten years earlier when earnings are adjusted for inflation, while top earners increased their annual earnings by 15 to 33 percent.

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"President John. F. Kennedy once remarked that 'a rising tide lifts all boats,' but it's clear that the so called 'new economy' in New England has only helped lift the yachts, rather than the more modest row boats," says lead author and economist Andrew Sum. "The average worker was running in place over the last decade."

The median real annual earnings of New England workers remained essentially unchanged between 1989 and 1999. When the researchers figured in inflation to calculate real earnings, the median worker made $35,000 in 1999, only $68 higher than in 1989.

Nearly all workers with annual earnings in the bottom-half of the distribution experienced a decline in their real annual earnings over the decade, with workers in the bottom ten percent suffering the steepest declines in real annual earnings, according to the study.

Those workers in the highest percentile - the region's top one percent - earned an average of $62,000 more a decade later, which translates into a more than 25 percent increase in ten years.

"It is certainly accurate to state that, among workers, the rich got far, far richer and the poor got poorer in New England over the decade of the 1990s," Sum says.

The center prepared the report for the U.S. Department of Labor's Employment and Training Administration.

To read the center's full report, click here (PDF).

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