BHI Weekly Dispatch: Notes on the Verizon strike, local inflation and the President’s visit

In an op-ed in the Boston Business Journal, BHI Executive Director David Tuerck offers some friendly but sobering advice to striking Verizon workers: technology, competition and globalization have changed the rules.

The strike is taking place against a backdrop of declining union membership and clout. Union membership has shrunk from 20 percent of all workers in 1983 to 12 percent today. There is a reason for the decline in union membership and clout. The old model of big unions facing down big companies has become obsolete in the face of globalization and technological advancement — trends that have turned telecommunications from an industry consisting of a few big monopolies into one characterized by ever-growing competition.

The entire article is here.

The highly-regarded PolitiFact site, hosted by The St. Petersberg Times and The Miami Herald recently quoted BHI studies on the economics of conventions as it fact-checked Republican National Committee chairman Reince Priebus.  

Director of Research Paul Bachman was quoted in an ABC News story about employment on Martha's Vineyard in the context of the President's vacation there.

The latest edition of BHI's Economic Indicators is now online. BHI's first economic forecast estimates that 84,000 jobs will be created in 2011 when all is said and done.

Inflation continues to trend upward. Prices, as measured by the July Consumer Price Index are up 3.6% versus last year.

CPIMA-USJulyoverJuly2011 

Massachusetts (or precisely Boston Metro) consumers are paying slightly more for gasoline that the national average but the same for food. Overall, MA inflation (3.4%) was slightly lower than the national CPI (3.6%) Energy costs such as those for household fuels and utilities in MA  increased more than three-fold: 10.1 (MA) versus 3.2 percent for all major metro areas in the U.S. The Federal Reserve Bank continues to maintain low interest rates inferring that what the economy needs is moderate inflation. Consumers in the Boston metro areas may want to debate that position and whether the core –what the Fed really looks at — is really reflective of the real world.  

As BHI's Paul Bachman noted  the farther you get away from urban centers like Boston the less impressive economic indicators appear to be and that apparently includes personal income defined by the U.S. Bureau of Economic Analysis wages and salaries, interests and dividends and transfer payments such as Social Security and Medicaid.

Last week, BHI issued an analysis of personal income growth.  It found that Worcester and Boston led the state's major metropolitan areas but that other regions lagged. 

The metropolitan Boston and Worcester areas continued to move ahead of the rest of the state in terms of personal income, according to an analysis of 2010 federal data by the Beacon Hill Institute at Suffolk University. However, poorer personal income growth in other regions in Massachusetts dragged the state below the national average for 2010.

According to the Bureau of Economic Analysis, personal income rose in almost every metropolitan area in the U.S. After falling 1.9% on the heels of the last months of the recession in 2009, personal income in 366 metropolitan areas of the U.S. rose 2.9 percent as the economy moved toward recovery in 2010.

Personal income grew 3.4 % in the Worcester metropolitan area followed by the Boston metro area with 3.1%. The growth in personal income is uneven across the major metropolitan areas in the Bay State. New Bedford (2.7%) and Springfield (2.2%) regions lagged the state’s two largest metro areas. Barnstable trailed with 2.0% while Pittsfield saw the smallest percentage increase with 1.4%

The Berkshire Eagle picked up on the Pittsfield angle. 

Learn more about the Institute:

BHI on Facebook
BHI on Twitter
BHI RSS feed

BHI on the web at www.beaconhill.org.

About Beacon Hill Institute

The Beacon Hill Institute engages in rigorous economic research and conducts educational programs for the purpose of producing and disseminating readable analyses of current public policy issues to voters, taxpayers, opinion leaders and policy makers.