Knowledge jobs take lead in state economy

Last summer, the Bay State became the third state (after California and New York) to make an important crossover in economic history: more people now work in servicem jobs than in manufacturingm jobs.

Massachusetts has built itself into a center for the post-industrial "knowledge industry." Besides its high share of the nation's health care and education business, the Bay State now counts a thriving trade in management and government consulting, energy and defense research, and high-technology design and manufacturing, especially in computers.

Most of this flows forth from the rich ring of suburban firms circling Boston -- and such engineer-producing educational institutions as the Massachusetts Institute of Technology, a source of many a technological idea whose time has come for profitmaking.

This was bound to happen. The industrial age -- which took root in America over a 100 years ago along a river in Lowell, Mass. -- became so efficient in producing wealth and "things" that fewer workers were needed to produce material goods in the state. More people could be paid to cut hair, wait on tables, or to push around paper, words, and ideas.

The state's employment growth has been stronger since any time after World War II and yet, during this period, jobs in manufacturing showed no substantial increase. Expansion of service jobs, despite the state's relatively small growth in population of 1 percent, was absorbed by a sharp rise in the number of women workers -- an increase that was ahead of most other parts of the US.

Still, state leaders don't like the trend. "Service industries just eat off manufacturing," says George S. Kariotis, Massachusetts secretary of economic development and manpow er affairs.