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January 23, 2007

Where services beat manufacturing

It's long been known that our economy has changed in a way that has increased services-sector jobs while decreased manufacturing jobs. Today, some are concerned with this change because they think services jobs pay less than manufacturing jobs. But N.C. State University economist Mike Walden says this isn't always the case.

"Ten years ago it was," says Dr. Walden, a Norht Carolina Cooperative Extension specialist. "But now ... we see that service jobs are actually paying more on average than manufacturing jobs in non-durable manufacturing.

"Heavy manufacturing jobs, or durable jobs, still pay more than services. But non-durable manufacturing –- in North Carolina, this would typically be, for example, textiles and apparel, food manufacturing, et cetera -- they are actually now paying less (in fact about $1 an hour less) than services jobs.

"And I think there are two reasons for this," he adds. "One is competition for those non-durable manufacturing jobs from overseas producers. We all know the story here in North Carolina of our losses in textiles and apparel and furniture to overseas producers.

"Secondly, though, is the growth of the professional and technical component of services jobs –- the jobs in professions: engineering, law, education, health care -- where those jobs are actually very high-paying," he concludes. "So the bottom line here is it's not necessarily bad in terms of pay that we are seeing a movement out of non-durable manufacturing into the services jobs."

Posted by deeshore at January 23, 2007 09:57 AM

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