Not All Workers Benefit From Maryland's Richest State Status, Says Report

By KATE PRAHLAD, Capital News Service

ANNAPOLIS - Maryland may be the richest state in the nation, but hourly workers are not seeing much of that money, according to a report released Friday by Progressive Maryland.

"State of Working Maryland 2007" said that while the state's high median household income earned it the top ranking in a Census report in August, stagnant wages are plaguing hourly wage earners with all levels of education and earning history.

"The label of Maryland as the richest state presents a false impression that everyone benefits from windfalls," said Donna Edwards, secretary and treasurer for the Maryland State and D.C. AFL-CIO.

State median wages are higher than the national average, but have only increased 36 cents per hour since 2001, according to an Economic Policy Institute report released Thursday.

"With fast-growing inequalities and the economy expanding, we're seeing more income concentration at the top of the scale," said Jared Bernstein, a senior economist at EPI and an author of the national report. "People recognize that the haves are getting more and the have-nots are stagnating."

But the president of Maryland Business for Responsive Government (MBRG), Robert O.C. Worcester, said all evidence "to the human eye" points to the contrary. MBRG, based in Baltimore, states it purpose as "to improve the role of business in formulating Maryland's public policy and to provide support for pro-business candidates of both parties."

"EPI's research is notoriously unreliable and I don't know how to respond to unreliable information," Worcester said.

"I suppose you can always find a sector of people who are underpaid, but nothing will ever be fast enough for these people," he said.

The Progressive Maryland report showed that the gap between Maryland's highest and lowest wage earners is worse than the national average, but Worcester said such gaps are to be expected in a state with the highest median income.

"You can't have it both ways," he said.

Ron Wineholt, vice president of government affairs in the Maryland Chamber of Commerce, agreed that data could be misleading.

Wineholt, who called EPI a "union-backed front," said compensation is based on skills an employee brings to a job. If an employee is not happy with compensation, he should find another job or attain more skills, Wineholt said. "Wages are based on services an individual performs," he said. "Marketplace provides the highest compensation for those who provide the highest-valued services."

Gov. Martin O'Malley on Friday acknowledged the more than 100,000 Marylanders living below the poverty line, as he discussed living-wage legislation that will take effect Oct. 1.

"Working poor should not be in the American lexicon," O'Malley said.

Bernstein said in the report that one reason for the stagnating wages may be the undermining of labor unions, leaving workers without bargaining leverage. Health care coverage declined in Maryland as well, with 13.8 percent of the population remaining uninsured, according to the Census report.

Unions also have some power to wield over workplace safety, which reduces work-related illnesses and injuries, according to the Progressive Maryland report.

"You take workers with the same skills and in the same workforce, plunk them down in a union, and suddenly they're earning 10 to 15 percent more in wages, and receiving better health insurance and a pension plan," Bernstein said.

Only 13.1 percent of Marylanders were members of a union in 2006, according to a Bureau of Labor Statistics study. Those union workers were earning almost $200 more per week than non-union workers, and the difference was even more for women, African Americans and Latinos.

"It's hard to imagine here in Maryland what workers go through to get a union," Edwards said. "They're still fired or harassed . . . it's changing though."

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