Workers without college degrees have for years seen their share of the economic pie shrink as the hyper-educated top 1% grab ever more. That long-run trend may still be intact; but for now, workers with dirt under their nails are staging a comeback according to the Economist. Besides construction, Nancy Lazar of Cornerstone Macro, an investment advisory firm, notes that wage growth has also accelerated in manufacturing, mining and logging, and transport. All these are industries where business activity is starting to grow faster than the overall economy, and all pay well. Ms Lazar says: “You are now entering a new cycle where higher-paying jobs are going to be a key component of the growth in employment.”
This may be why blue-collar pay is on an upswing. For the past two years hourly wages for all workers have grown at an annual rate of around 2%. But, excluding managers and supervisors, the growth of hourly wages for production workers has accelerated, to 2.3% in April from 1.5% in early 2012 (see chart). The gains are still too slight to pose an inflationary threat, especially since salaries in low-paid industries such as retail remain weak.
