Abstract
Since the early 1970s, New England has experienced a dramatic economic change from trouble to prosperity. Wages and income levels have increased relative to other regions, and regional unemployment rates have been below the national average. Performance of the region's durable goods manufacturing industries appears to be responsible for the transformation. In the mid-1980s, manufacturing performance of the region fell short of national figures, but vigorous growth in nonmanufacturing activities maintained overall employment growth in New England. The improved outlook for manufacturing nationwide is likely to ensure that weakness of manufacturers will not spread to nonmanufacturing. The region may not experience the pickup in manufacturing activity felt in other regions, but slower than average growth in manufacturing and overall employment is compatible with continued prosperity and low unemployment rates.