I've finally read my copy of January's Notes, the monthly newsletter from the Employee Benefit Research Institute. (They need more exciting covers.) It features lots of charts on how educational attainment and other demographic factors affect pensions. For example, people with graduate degrees are the most likely to collect retirement benefits -- but middle-income workers are more likely to be getting benefits (though they're less generous) than high-income workers. Also, there remains a big gender gap, with the median annual pension for a man at $14,280 and for a woman at $7,848.
The differences between private- and public-sector employees are also striking. Among people over 50, 12.6 percent of people who had worked in the private sector were collecting pensions or retirement annuities as of 2006, compared with only 7.5 percent of people who had worked for the government. But the mean annual income from pensions and annuities was much higher for public-sector retirees ($17,974) than for private-sector retirees ($8,148). This is nothing new: the public-private ratio has been a bit more than 2 to 1 for at least the past 30 years. And it doesn't seem likely that the gap will narrow, given that private employers are cutting back on retirement benefits. As the EBRI authors note: "future retirees will likely be more reliant on assets they must manage themselves instead of receiving a stream of income for life (i.e., an annuity)."
USA Today's Sandra Block writes that Baby Boomers may be making a big mistake by retiring at 62, the first year they're eligible for Social Security benefits:
...millions of the oldest boomers may be about to make a colossal error — one that would be magnified by their record-setting longevity.
Over time, taking benefits early could mean a smaller payout, hefty taxes on their retirement savings and a heightened risk of outliving their money. In fact, the roughly 50% of the oldest boomers who the Social Security Administration estimates will tap their benefits starting this year will absorb a permanent 25% cut in benefits.
A 2004 MassINC study, The Graying of Massachusetts, warned of precisely this problem: "Many Massachusetts workers will face a stark choice in the coming years: Retire later or retire with less money." Read the report, as well as a transcript of a panel discussion of the topic, here.
The Census Bureau has just posted new data on how educational attainment affects personal income. Among the findings: Workers with vocational education earn the most in the electronics field (an average of $3,726 per month) and the least in cosmetology ($1,861). For those with associate's degrees, engineering/drafting is the most lucrative field ($4,435), with education at the other end of the scale ($2,299).
The worth of a bachelor's degree ranges from $5,730 per month in the computer industry to $2,924 in education. For those with advanced degrees, the highest-paying field is medicine/dentistry ($10,795), and the least is liberal arts ($3,477).
To their supporters, pilot schools are laboratories for fresh educational ideas that eventually can be applied to traditional schools. The union says it supports pilot schools in theory, but clearly it cannot buy into an educational idea that involves tossing union protections out the window.
"You can be removed from the building you've been teaching in for 15 years, and moved to the other side of the city," said Stephen Crawford, a BTU spokesman. "That's just one of the collective bargaining rights teachers sacrifice."
Crawford's concern is understandable but also a bit disorienting, since we've become accustomed to reading about people afraid that their jobs are going to move to the other side of the country, if not the world. Another example of how everyone has a different perspective in a global economy.
Massachusetts would be dead last in job creation from 2001 to 2006. In fact, the Bay State is still 100,000 jobs short of its 2001 level, which was the peak of the last business cycle. But not all is bleak: Massachusetts still has the country's best-educated workforce and scores near the top in productivity.
These are among the highlights of MassINC's latest study, Mass Jobs: Meeting the Challenges of a Shifting Economy. You can download the complete report here. Also check out the Boston Globe's editorial "A Niche Economy," and listen to WBUR's interview with MassINC director of research Dana Ansel.
Things that transport other things still make up the biggest manufacturing sector in the US, but the number of people employed in the automotive, aerospace, and shipbuilding industries is on the decline. That's the bottom line from the Census Bureau's Annual Survey of Manufactures (yes, there's no second "r"), released today. The report includes state-level data on the number of workers in each sector, which brings us to the map below:
As you can see, the transportation industry dominates in 14 states. That means automobile manufacturing in the interior states from Michigan to Alabama; shipbuilding in Maine and Virginia; and aerospace in Washington. Food processing is tops in several Southern and Farm Belt states, and the computer/electronics sector is in the lead in much of the Northeast, the West, and Florida. The chemical industry is first in New Jersey and West Virginia, and wood products are king in Oregon.
Our second map shows the biggest manufacturing sector in each state that added jobs from 2005 to 2006. Transportation doesn't look so hot here, as it shed jobs in 11 of the 14 states in which it is the dominant sector. Michigan, for example, lost nearly 13,000 transportation manufacturing jobs in that single year. It's hardly compensation that the state gained nearly 300 jobs in the "other general purpose machinery" category, the biggest sector to show any kind of an uptick. Meanwhile, the computer/electronics sector seems to flit around a lot. It added jobs in only four states (Massachusetts, Minnesota, New Hampshire, and Vermont) where it was already the top sector, but it's on the rise in Arizona and Washington, where aerospace is losing influence.
Nationally, "fabricated metal" was the biggest sector that added manufacturing jobs; that category includes a lot of hardware goods and home-building materials. Of course, manufacturing overall is continuing to shrink as a source of jobs. Employment was up last year in only 14 states: Alaska, Arizona, Iowa, Kansas, Louisiana, Montana, New Mexico, North Dakota, Oklahoma, Rhode Island, South Dakota, Texas, Utah, and Wyoming.
Today's map, in a seasonal color, uses recent Census data to show where people are most likely to still be working past the traditional retirement age of 65. Seniors are most likely to be in the labor force (i.e., working or actively looking for work) in mostly rural Nebraska and South Dakota, along with the urban enclave of the District of Columbia. But participation is also high throughout the Farm Belt, as well as in Northeastern states that do not have large populations in the Rust Belt (that leaves out New York and Pennsylvania). In general, states with high workforce participation among older residents tend to have healthy and relatively well-educated populations, in addition to low unemployment rates overall.