Report: Job picture in Mass. remains mixed

Dan Devine

Unemployment in Massachusetts last year was higher than the national average for the first time in more than a decade, but the median wage earned by workers in the Commonwealth started to trend upward in 2006, according to a recent report by a nonprofit research group.

In the report, entitled “The State of Working Massachusetts: A Growing Economy; A Growing Divide” and released last week, the Massachusetts Budget and Policy Center (MBPC) portrays the Massachusetts employment picture as something of a mixed bag.

“In reviewing the conditions of working people in Massachusetts in 2006, we see both good news and bad news,” the report says.

The state’s unemployment rate reached 5.1 percent in 2006 — one-half of a percentage point higher than the national rate of 4.6 percent, marking the first time Massachusetts has outpaced the country since 1992. That would qualify as the bad news.

Last year’s 2.1 percent bump boosted the median wage — the amount of money per hour that half of workers earn more than and half earn less than — to $17.24, up from $16.89 in 2005. That is the good news.

The jolt is the first such up-tick here in several years. Since 2003, the Commonwealth has seen a 2.9 percent drop in real median wages, the steepest decline of any state in the nation during that period. Last year’s increase represents a reversal of that trend.

Good news, right?

Even within the silver lining of a “good news” item, though, the elements of a dark cloud can exist.

Analysts note that the devil is in the details.

“While the increase in median wages is a positive sign, the current economic recovery, in Massachusetts and nationally, is weak by historic standards,” the report says. Even with the recent increase, the state’s median wage “is still almost 3 percent lower than the $17.76 level in 2003.”

On the plus side, despite the recent stunted increase, the report identifies Massachusetts as a “high-wage state” compared to the U.S. as a whole. The median wage here is now $17.24; the national figure is $14.81.

But the MBPC’s breakdown of wages by income level suggests enthusiasm about the median wage increase should be tempered — because while earnings have begun to increase for middle- and high-income workers, progress is slow in coming for those with lower incomes.

The median wage increase last year reflects higher earnings for workers at the 80th percentile, who saw a 0.9 percent increase in pay to $30.05 an hour. But Massachusetts workers at the 20th percentile saw their wages dip to $10.08, a 7 percent drop from 2003-2006. Between 2005 and 2006, the decline was 3.3 percent, the fourth largest fall in the country during that period.

The report also sees mixed results on the employment front.

Massachusetts has experienced consistent, if somewhat slow, job growth over the past few years — notably in the education and health services field, which employed 18.7 percent of the state’s working population in 2006, and in the high wage professional and business services field, “where the state’s natural strengths — well-educated and highly skilled workers — are particularly important,” according to the report.

At the same time, the MBPC has concerns about the state’s continued struggle to return employment figures to the levels they reached before the nation’s 2001 recession.

“[T]he level of employment in Massachusetts remains below what it was at both the start and the finish of” the 2001 downturn, which lasted from March through November, the report says. “Only Michigan and Louisiana have experienced deeper job losses than Massachusetts since 2001.”

As of June, employment in Massachusetts was 2.8 percent below its level when the recession started — a difference of 93,900 jobs. More troubling, employment was still 10,400 jobs below where it was when the recession ended.

“If our measure of economic progress is expanding opportunity and rising wages for working people across the economic spectrum, then we have yet to see real progress in this economic cycle,” said MBPC Executive Director Noah Berger in a statement.

The report also found that labor force in Massachusetts is less ethnically and racially diverse than it is across the nation, though it does feature a larger share of older and female workers than found nationwide.

Whereas African Americans accounted for 11 percent of the U.S. workforce in 2006, they comprised only 4.9 percent of the total in Massachusetts. Similarly, the national figure for Hispanic workers (13.7 percent) far outstripped the percentage within the Commonwealth (6.4 percent).

Though those statistics appear at first blush particularly grim for minorities in Massachusetts, the MBPC’s Berger said they are primarily a function of the state’s demographics. According to the U.S. Census Bureau’s American Community Survey, African Americans account for 5.9 percent of the Massachusetts population, while persons of Hispanic heritage make up 7.9 percent of the total.

Similarly, other measures — such as “labor force participation rate,” which assesses the percentage of a group of people either employed or actively seeking employment — reflect national averages for African Americans, Berger said.