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Labor force trends in Texas.

Labor Force Trends in Texas

The U.S. Department of Labor estimates that 85 percent of new entrants into the labor force from now through the year 2000 will be either women or minorities. White males, who made up 42 percent of the Texas labor force in 1980, will comprise only 35 percent of the labor force by the year 2000. This dramatic diversification of the labor force arises from several factors:

* The entry of the "baby bust" generation into the labor force, meaning that to replace retiring workers and to fill newly created jobs, employers must attract new workers from groups that have traditionally had low rates of labor force participation (i.e., women);

* The decline in real wages since the early 1970s coupled with a dramatic increase in housing costs over the same time period, causing most young families to need two incomes;

* The increasing percentage of American women with college degrees and better job opportunities for women, which combine to strengthen women's attachment to the labor force and increase the opportunity costs of leaving the labor force to raise families; and

* A lower-than-average age and higher-than-average birthrate for minority populations, particularly Hispanics.

Linked with the demographic predictions about new workers are projections that most new jobs will occur in the service and information fields and that these jobs will require higher skills than the current mix of available jobs. These trends mean that employers will face new challenges in the coming decades in attracting and maintaining well-qualified and productive workers. Texas employers should be particularly concerned with these trends because of the poor job the state's educational system is doing in preparing minorities for future labor force participation--currently, 45 percent of Hispanics and 34 percent of blacks drop out before getting a high school diploma.

Many of the new entrants into the labor force will have to juggle the demands of jobs with the demands of raising families. Most employers have not yet adjusted to the fact that less than 10 percent of the Texas labor force is composed of "traditional" family heads with wives at home to care for the children and manage the household. Currently, working parents comprise over 36 percent of the Texas labor force. Issues that affect the health and well-being of an entire generation, such as the availability of reliable and affordable child care, are still largely considered family problems rather than societal concerns.

As more employers become aware of the implications of the changing labor force, we can expect to see a number of initiatives on the part of both employers and the government, such as:

Greater emphasis on the education and training of new labor force entrants. A number of companies have either stepped up their own training programs or are becoming involved in the public schools through Adopt-a-School programs as a means of closing the current and expected gap between the skills of new labor force entrants and those required to perform available jobs. Government programs designed to move disadvantaged individuals and welfare recipients into the labor force have also begun placing more emphasis on basic educational skills.

Radically different employee benefit packages and work schedules. Employers will feel increasing pressure to provide benefits packages that meet the needs of both working parents and workers without families. Some employers have already begun to use such options as flexible benefits, parental leave, child care, and alternative work schedules as recruiting tools so that they can hire the types of workers they want. This trend is expected to continue. In addition, as society better understands the relationship between early childhood development and the future preparedness of the labor force, governments may (and probably will) mandate benefits that make it easier to work and raise families.

Increased pressure to relax immigration laws. If labor shortages develop in some occupations due to the slower-growing labor force, employers may ask Congress to change immigration laws to help relieve those shortages.

Regardless of the approaches taken by employers and governments to deal with changes in the labor force, almost every employer will be affected by them. To remain competitive in a global economy, employers and governments in the U.S. and Texas must cooperate to find solutions that enable participants in our diverse work force to reach their full employment potential.
COPYRIGHT 1989 University of Texas at Austin, Bureau of Business Research
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Copyright 1989 Gale, Cengage Learning. All rights reserved.

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Author:Schexnayder, Deanna
Publication:Texas Business Review
Date:Oct 1, 1989
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