Wages Stagnate as U.S. Manufacturers Reap Record Profits

By:  Tim Catts, Peter Robison and Ilan Kolet

Machinist Michael Pargeter reached for a reference to a TV cartoon set in the Stone Age to explain why union members were spurning a contract offer from Boeing Co. (BA)

Wages would be set “back to the Flintstones era” with a plan to slow future raises for new employees, Pargeter, 62, said outside a Seattle union hall last week while ballots were being counted, referring to an animated television show about prehistoric family life.

Boeing’s quest for concessions and employees’ opposition exposed a fault line in U.S. industry’s post-recession comeback: Even with hiring and output robust enough to be dubbed a manufacturing renaissance by President Barack Obama, workers are falling behind. Factory pay hasn’t kept pace with inflation and has fallen 3 percent on that basis since May 2009, while average pay for all wage earners slid only about 1 percent.

“We need to focus on how many jobs there are that give an adult a chance to earn a decent living,” said Gordon Lafer, an associate professor at the University of Oregon’s Labor Education and Research Center in Eugene. “Too much of the discussion has been about the number of jobs, and that’s obviously important, but there’s also a crisis in the quality of jobs.”

Boeing said it needed labor givebacks to keep the Seattle area as the home of the 777X jet, a new model with more than $95 billion in orders since September. Union workers said Boeing needed to share more of the wealth they help create.

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