Thursday, August 02, 2007

Wage Stagnation for White-Collar Workers

In That Raise Might Take Four Years to Earn as Well, we learn that wage stagnation has come to white-collar workers. Wage stagnation, in which wages remain the same while all other costs of living rise, is nothing new for blue-collar workers, but it is relatively new for the white-collar worker.

When we create new jobs in the United States, often they are temporary, contract, or freelance work. At a personal level, this is probably good for me, but I don't htink it's good for everyone. And things are certainly changing:

Harvard University economist Richard Freeman gained fame for his 1976 book "The Overeducated American," in which he detailed the previous erosion of college graduates' wages. Today, he believes college-educated workers will continue to see their wages erode because of the increasing globalization of the labor market.And wage erosion is likely only to intensify as the number of college graduates rises in China, India and other offshoring hubs. China alone expects the number of college graduates to increase by 22% this year, with 4.13 million job candidates entering a domestic market with only 1.66 million jobs available, according to a Chinese government report released in May.