Working Paper: NBER ID: w0446
Authors: Richard B. Freeman
Abstract: Since World War II, the labor market in the United States has experienced significant changes in the composition of the work force, the type of work performed, institutional rules of operation and structure of wages, and employment and unemployment. Some of the changes continue historic trends. Others, however, have diverged from developments of earlier decades to create new labor market conditions and problems. In this paper, I identify seven of the most important changes, document their magnitude, and seek to estimate their impact on the economy.
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Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Decreasing Rate of Growth of Real Wages and Labor Productivity (J39) | Decreasing Rate of Growth of Real Wages (J39) |
| Decreasing Rate of Growth of Real Wages and Labor Productivity (J39) | Decreasing Rate of Growth of Labor Productivity (O49) |
| Change in Workforce Composition (J21) | Shift in Labor Demand and Employment (J29) |
| Demographic Shifts (J11) | Union Membership Decline (J50) |
| Legislation and Workplace Norms (J81) | Operational Changes in Firms and Unions (J51) |
| Economic Cycles (E32) | Changes in Unemployment Rates (J60) |
| Wage Inflation (J31) | Changes in Unemployment Rates (J60) |
| Educational Attainment (I21) | Altered Wage Structure (J31) |