ANN ARBOR—More employment opportunities are available for Michigan’s low-wage workers, but these jobs don’t pay as well as they did two decades earlier, says a University of Michigan professor.

Average wages for these workers eroded between 1970 and 2000, however, so that less-skilled workers—defined as those without a high school diploma—no longer earned markedly higher wages than similarly educated workers in other states, said Rebecca Blank, dean of the Ford School of Public Policy. “The result is that Michigan’s labor market situation now looks much more like that of the nation as a whole and is less unique,” Blank said.

Michigan enjoyed the status of a high wage state in 1979, with median weekly wages $76 higher than the United States. But the wage gap closed. By 2000, Michigan workers overall earned $532 each week, only $28 more than U.S. workers. Michigan’s less-skilled workers experienced particularly steep earnings declines, with inflation-adjusted median weekly wages of $292 in 2000, down $100 from 1979.

The state should pursue multiple policy approaches to reverse the long-term deterioration in wages for the less skilled, she said. Retaining these workers in the labor market even at low wages with subsidies is preferable to having them drop out of mainstream employment.

Blank’s research is featured in the new book, “Michigan at the Millennium,” that includes chapters about changes in the state’s economy, population, fiscal structure and public policies. Her analysis came from data collected by the U.S. Census Bureau, which collects employment information on a monthly basis from a random sample of households.

Michigan’s high wage/high unemployment environment of the late 1970s and early 1980s has disappeared, said Blank, whose research focuses on labor economics and income distribution. For instance, unemployment rates among those without a high school diploma in 1983 surpassed 25 percent in Michigan, much higher than in the nation but were at 10 percent by the late 1990s and close to the national average for this group of workers.

The long-term unknown for low-wage workers is the status of the larger labor market. If the 2000s repeat the stellar economic performance of the late 1990s, then the need for more workers will provide employers with incentives to hire and train the less skilled, Blank indicated. If demand for labor is not as strong, wages among the less skilled may continue to decline.

Among her other findings, Blank said women have unambiguously improved their labor market position in Michigan during the last two decades. Their wages have increased, both in absolute terms and relative to male workers, she said. Women earned about one-third less than equivalent men in 1979; by 2000, they earned about one-quarter less.

Related links:

• Rebecca Blank
• The Ford School began in 1914 and is among the nation’s leading policy and public administration schools