Study finds slowing New Hampshire wage growth

Despite New Hampshire’s consistently low unemployment rates, wage growth in the state has not kept pace with rising costs of living, according to a newly released report from the Carsey Institute at the University of New Hampshire.

The report, “The State of Working New Hampshire 2007” — produced in cooperation with the Economic Policy Institute — notes that while New Hampshire workers fared better than the rest of the region and the nation in 2006, they have not benefited to the same extent that they did during the economic expansion of the 1990s.

“New Hampshire’s recovery since the recession in 2001 has been slow,” said the report’s author, Allison Churilla, a policy fellow at the Carsey Institute and a Ph.D. candidate in sociology at UNH. “Despite high growth in productivity, by and large, New Hampshire workers have not seen similar growth in their paychecks or in jobs.”

Among the brief’s major findings:

• New Hampshire had a 71 percent labor force participation rate in 2006, compared to 66 percent nationally and 68 percent in New England. The labor force participation rate has dropped since 2000, when it stood at 73 percent, a decline that is largely related to lower rates of participation among young workers, male workers and workers with a high school degree or less.

• Job growth was positive between 2000 and 2006, led by the health care and education sectors, but manufacturing jobs continued to decline. Manufacturing was the state’s largest industry in 2000, when it employed more than 100,000 workers, but the industry lost 25,000 jobs over the last six years and dropped to the fourth-largest industry by 2006.

• Median wage growth in New Hampshire was 8 percent between 2000 and 2006, steeper than the national median wage growth of 3 percent. But since 2000, median monthly rental payments in New Hampshire have increased 19 percent and median mortgage payments by 21 percent.

“Policymakers and others need to consider those workers that have not benefited during the so-called jobless recovery that has characterized the state’s economic recovery since 2001,” Churilla said.

The issue brief is available for download at www.carseyinstitute.unh.edu.