This is not a new story but it’s always nice when the mainstream media highlight something we’ve been discussing here for many months, and something so many people have pointed out for a long time. The Sunday New York Times Business Section has a front-page story headlined, “Two Tiers, Slipping Into One: As Workers Retire, a High-Wage Era Ends.”

I think a key point is this one:

Caterpillar is adding a significant chapter to the labor cost-cutting that is widespread in America, particularly at old-line manufacturing companies. Until recently, cutbacks in the wages and benefits of hourly workers were limited mostly to money-losing companies: failing steel mills, for example, and struggling airlines. They have said that their survival was at stake.

Now, however, even healthy and highly profitable companies like Caterpillar are engaging in the practice, and as they do so, the longstanding presumption that factory workers at successful companies can achieve a secure, relatively prosperous middle-class life for themselves and their families is evaporating.

So, while workers are now struggling to make ends meet…

CATERPILLAR, meanwhile, is prospering. It reported revenue of $36.34 billion last year, up 20 percent from 2004. That was on top of a 33 percent increase in 2004 from 2003. Net income was up 40 percent last year, to $2.85 billion; it has nearly tripled since 2003. Tens of millions of dollars have gone into research to develop a great variety of Caterpillar products that sell against those of Komatsu and Volvo, the two biggest foreign competitors.

In the past, such gains would have also translated into higher wages and more generous benefits as contracts were renegotiated every two or three years. But the current, long-term U.A.W. contract at Caterpillar calls for just one general raise: 2 percent in December 2008.

Two thoughts come to mind. First, not that I would expect it from The Times, but the story does not express outrage at this phenomena–extremely profitable companies shredding the basic social contract.

Second, to end on a positive note, one worker interviewed says that the lowering of wages has made him a more active participant in his union. It’s certainly not the path one would choose but the ugliness of the Darwinian economic world we live in may offer the most hope for a revival of the labor movement–if it can seize the day.