- The Washington Times - Monday, September 4, 2000

American workers are enjoying one of their best years ever. The booming economy has given working people a lift and an edge over employers that they haven't seen in a generation.
With unemployment hovering near 4 percent for the past year, record numbers of blacks, Hispanics and other minorities are finding jobs, and more women are working than ever before. Wages are growing close to 4 percent a year on average. Although soaring energy costs have eaten into purchasing power, families still are on course to post another year of strong gains in income.
With employers in many areas desperate to find and keep workers, employees are dictating the terms of their employment more than ever before. Working mothers are finding employers willing to be more flexible about hours and helping to arrange child care. Unionized workers are getting breaks from mandatory overtime.
In nearly every profession, bonuses and pay increases based on merit have become common, and increasing numbers of workers are being paid with shares of company stock. That not only increases the wealth and buying power of today's workers, but it also gives them an important stake in the continuing strong performance of the company and the economy.
But the nationwide shortage of workers means that many Americans also are working harder, putting in more overtime hours than they ever planned to help their companies meet the constant demands of consumers.
"It is an amazingly prosperous time," said Labor Secretary Alexis M. Herman, noting that the remarkable performance of the economy owes largely to the hard work and discipline of the nation's 141 million-strong labor force.
The economy's robust 5.3 percent growth rate in the last quarter is owed almost entirely to the increased output of workers the biggest such productivity increase in decades and an unprecedented boon this late in the business cycle, economists say.
Such strong productivity gains mean that the economy can keep growing strongly, and that wages and salaries can rise even further without causing fears of inflation, economists say.
"This is really the people's prosperity. It is their sweat and toil and intelligence and determination and sacrifice that have carried our prosperity to new heights," Mrs. Herman said.
Businesses have been reveling in the increased growth and profits as well but are edgy about how long it can continue as labor shortages start to crimp the expansion plans of many companies.
A scarcity of skilled workers in the information-technology industry already has resulted in a loosening of immigration rules to enable educated foreign workers to fill the jobs. Now, industries from restaurant and hotel to farming are pleading for similar measures to allow more unskilled workers into the country.
"The employment paradigm has shifted dramatically," said Ed Potter, president of the Employment Policy Foundation, a business group. "Jobs are plentiful, but employees are scarce," he said, predicting that the country will be short almost 5 million workers in 2008 if trends continue.
The business group is pushing for increased immigration to fill the gap, as well as legislation by the next president and Congress to help U.S. workers gain the skills, tools and flexibility they need to fill the demand.
Increasingly flexible job arrangements will be needed to stretch the resources of today's workers, including phased retirement, telecommuting, compressed workweeks and compensatory time, the policy group says.
But federal labor laws, which date back to the 1930s when most Americans were employed on farms or in manufacturing and families had only one earner, make it difficult for employers to change rigid work schedules, he said.
Politically powerful labor unions have fought any changes in the laws and have been resisting business' growing reliance on temporary and contingent workers. They say business' principal goal is to get out of paying pension and health-care benefits.
Businesses and economists say temporary firms play an increasingly important role for businesses that need only short-term help and employees who don't want full-time jobs or need work experience to get them.
The Clinton administration last week gave labor unions a boost with a ruling by the National Labor Relations Board that Mrs. Herman said will make it easier to organize temporary workers.
AFL-CIO President John Sweeney last week contended that strains placed on workers in today's economy are driving more people into unions, which last year enjoyed their fastest membership growth in decades.
Union activity has continued this year, and the labor groups "have won some historic battles," he said at the National Press Club, citing favorable settlements by the Boeing engineers in Seattle, janitors and actors in Los Angeles, and Verizon Communications Corp. telephone workers.
Union leaders trumpeted the "path-blazing" agreement last month between Verizon and the Communications Workers of America as a sign that their clout is growing. The deal substantially cuts forced overtime hours for customer-service employees and technicians and limits transfers of employees as a result of the former Bell Atlantic's purchase of GTE.
But economists note that the stock options and 4 percent annual wage increases the Verizon union won are standard, and maybe even below average, for high-tech workers.
A survey by Hewitt Associates of Lincolnshire, Ill., found that salary increases next year will range from 4.1 percent for nonunion hourly workers to 4.5 percent for executives. Most companies plan to supplement that pay with bonuses based on performance or stock options, the survey found.
"Companies have evolved from offering only executives and managers variable compensation to making employees at nearly every level eligible," said Hewitt's Ken Abosch. Technology professionals are commanding the biggest wage gains because 82 percent of employers are having a hard time attracting them, he said.
Still, union leaders hope to make inroads organizing such "new economy" workers. They note that many more jobs offering poverty-level wages will be created in the next decade than computer engineering jobs including cashiers, truck drivers, home health aides, teaching assistants and cleaning personnel. Women and minorities are more likely to hold those low-paying jobs, they point out.
"Our booming economy needs more time to lift up the small boats that have been left behind," Mr. Sweeney said.

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