Direct labor costs track upward.

Purchasing, March, 1997

A tightening market for skilled labor may take center stage in supplier negotiations this year. "Pockets of serious wage escalation are emerging in the manufacturing sector and some regions of the country," notes Elizabeth Baatz, manufacturing cost analyst for Thinking Cap Solutions (TCS) in Boston, Mass., and editor of the ICE-Alert newsletter.

In the past decade, Baatz says, labor has made few appearances at the negotiating table because "the manufacturing sector's annual wage growth has ranged from a high of only 3.3% (in 1990 and again in 1996) to a low of 1.8% in 1987." Still, she says, "all this may be changing now." For some months, economists have been fretting the apparent disconnect between tight labor markets and slow wage growth. Back...

Read the rest of this article with a Free Trial at HighBeam Research.

Premium Content Partnership | HighBeam Research provides an in-depth online archive library of reference works.