Tags

, , ,

My last post dealing with the Great Stagnation pointed out a number of U.S. economic trends. However, it did not discuss changes in the composition of the labor market. This post will rectify this omission.

employmenttrendsline
http://research.stlouisfed.org/fred2/graph/?g=VCv
employmenttrendsarea
http://research.stlouisfed.org/fred2/graph/?g=VI6
The fastest (or second-fastest)-growing private-sector occupation category, before and after 1973, in the U.S. is (no surprise) Education and Health Services. Its growth was very closely related with that of the ever-mysterious Other Services up until the 1990 recession, when Education and Health Services showed itself to be utterly recession-proof. Education and Health Services jobs are typically high-skilled, but medium-paid. In recessions, the first-hit occupation categories are Professional and Business Services and Trade, Transportation and Utilities. The third-fastest-declining occupation category, both before and after 1973, was Information Services. This is probably due to the declining scarcity of information. Unskilled nondurable and durable goods manufacturing has, as has been noted by practically everyone commenting on it, been shipped off to Asia (first Korea, Thailand, and Indonesia, then China, Vietnam, and Bangladesh), though nondurable manufacturing employment was clearly on the decline before the rise of Asia. This deindustrialization has led to increased unemployment among the unskilled and the unionized. Professional and business services jobs are generally skilled jobs which have below-average unionization rates. Their growth thus exacerbates income inequality. Leisure and Hospitality jobs are typically low-paid, and their employment is fairly fast-growing. The percentage of construction jobs has stayed remarkably constant. There are not nearly enough job-creators in the financial industry. Income inequality within occupations has clearly risen, as well, as earnings for production and nonsupervisory workers in finance (where they have grown the most) have still been lower than GDP growth.

BTW, the only major occupation category in this chart which is missing is agriculture, where employment collapsed until about 1970, and, from then on, declined at roughly the same rate as in durable manufacturing. This explains the higher growth in the earlier period, though does not explain the skyrocketing real wages at the time.

Advertisements