During the late 70s and 80s, the returns to education in the U.S. labor market increased...

During the late 70s and 80s, the returns to education in the U.S. labor market increased rapidly. What are possible explanations for this? What do you predict will occur in the labor market because of the trend?

Expert Solution

RETURNS TO EDUCATION IN THE U.S LABOR MARKET INCREASED RAPIDLY: During the 1970s there was a mass increase in both the turnover in the U.S labor markets. In the 1970's the average annual growth rate of the civilian labor force was much greater than its preceeding 20years. From 1970 to 1980 though the civilian employment did not grow quite as fast as the labor force but after that there was a rapid increase in the U.S labor market. The labor force rate rose to 38% in 1960, 43% in 1970, 52% in 1980 and 58% and further more increased a lot and it has almost crossed 60% by now. During 1950s population growth alone was responsible for the growth of the labor force. In 1970-1980 period, when the labor force participation of women underwent rapid growth 76% percent of labor force growth was the result of population growth. Population growth and the changes in participation determines the labor force growth in the market.

LABOR MARKET TREND: Some of the current labor marke trends are: 1. Older workers holds the biggest gain in labor force participation from 1970s. 2. Most Job Gains in Full-time positions. 3. Fast wage growth since the recession. 4. Women labor force participation. 5. Employment gains in all industries The labor force participation rate is the portion of the workforce done. There are two types labor market i) Primary sector and ii) Secondary sector. Because of trends there will be a mass growth in the industrial structure and it will lead to globalization and technological and will lead to increase labor force in the market. Trends will carry the labor force market into the next level.

Rahul Sunny answered 1 year ago

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