Printer Friendly

New projections to 1995.

New Projections to 1995

The economy is projected to reach the $3 trillion mark and employment will grow by more than a million a year, topping 122 million by 1995, according to the latest projections developed by the Bureau of Labor Statistics. Details on these projections appear in a series of articles published in the November 1985 issue of the Monthly Labor Review.

This picture of the 1995 economy developed by BLS--given in 1977 dollars--is based on recent trends and data for 1984; the previous set of projections, described in the Spring 1984 issue of the OOQ were based on data for 1982 and given in 1972 dollars. The new projections point toward higher productivity and slower labor force growth than was called for in the projections developed 2 years ago.

Assumptions concerning possible trends through 1995 play a major role in developing the projections. Those assumptions deal with such factors as the gross national product (GNP), productivity, the labor force participation rate of women, and more than 100 other variables. Three different sets of assumptions were used by BLS in order to arrive at high, moderate, and low rates of change.

BLS prepares new medium-range projections like these every 2 years. The program produces projections for five areas: (1) The labor force; (2) aggregate economic performance; (3) final industry demand and total industry production; (4) industry employment; and (5) occupational employment. This article describes the method used in making projections for each area and presents some highlights of the results for the moderate scenario.

The Labor Force

The new projections show the labor force growing at only half the rate experienced in the mid-1970's. The number of young workers (ages 16 to 25) will continue to decline in the coming years, according to the projections. This trend, which began only recently, is a sharp departure from the fast-growth decades of the past. The slow growth of the labor force means that, taken as a whole, the average growth of occupations will be slower than in the past.

BLS's labor force projections are themselves based on other projections. The Bureau of the Census prepares projections for the population as a whole, and BLS projects the labor force participation rate for various groups, such as young people and women over the age of 55. These rates are derived through an analysis of the actual participation of the groups from 1962 to 1984; modifications are made if change is deemed likely, for example, because the participation rate of a younger group is likely to be higher than that of an older group or vice versa. The participation rates for the various groups (there are 82 of them all together) are then applied to the population projections, and the results added together.

The labor force projections portray a group of workers very different from that of the recent past because of the aging of the baby-boom generation and the slower rise in participation among women age 20 to 44. Young, new workers will have a smaller share of the labor force, and the average age of workers will rise. The share of the labor force held by the 16- to 24-year-old group was about 24 percent in 1975; in 1995, it will be only about 14 percent. Another trend affecting the nature of the labor force is the increasing tendency of older workers to retire early. The combination of these two trends will result in a labor force dominated by workers aged 25 to 54. Both the number and the percentage of primeage (25- to 54-year-old) workers will increase. By the end of the period, these workers will make up three-fourths of the labor force; in 1975, they represented only about 60 percent of the labor force. Blacks and other minorities are also expected to increase their share of the labor force over the period.

GNP and Demand

The projected gross national product for 1995 exceeds $3 trillion; that's the equivalent of spending (or earning) about a million dollars for every second, all year long.

In order to make these projections, economists built a model of the economy that correlates numerous economic factors. The model used by BLS, developed by Wharton Econometrics, has almost 900 variables, such as the size of the labor force, income, business investment, investment in homes, consumption, government expenditures, changes in business inventories, and foreign trade. These factors are related to each other through 2,400 different equations. The results of changes in the variables are analyzed for reasonableness and consistency. Depending on the assumptions made for such variables as those stated, the GNP in 1995 would be $3.2 trillion--in 1977 dollars.

The largest component of GNP is personal consumption, which accounted for almost 65 percent of the whole in 1984. Other major components are Federal Government, State and local government, private investment, and foreign trade. Personal consumption, in turn, is divided among purchases of durable goods, nondurable goods, and services.

The fastest growing durable goods categories--indeed, the fastest growing categories--are expected to be computers and related equipment and telephone and telegraph apparatus. Personal consumption expenditures for computer and peripheral computer equipment, such as disk drives and printers, are projected to rise a robust 20.9 percent a year, despite short-run problems. Other electronic products--such as telephone equipment, television sets, video cassette recorders, and audio tape recorders--are also expected to continue increasing in sales.

The largest category within durable goods is motor vehicles. Sales of new cars boomed to 10.4 million in 1984, recovering from the dismal record of 1982. Although only a slight increase is expected for 1995, sales of cars, trucks, and vans for personal use are projected to total $64 billion that year.

Nondurable goods include food, clothing, and medicine. Expenditures for nondurables tend to be more closely tied to population growth than other categories of expenditure. The projection of slow growth in population and household formation in the next decade is reflected in a moderate growth rate for all nondurables except drugs and pharmaceutical products, which are projected to grow even more rapidly in the future than they did in the past.

Personal consumption expenditures for services are projected to grow about 50 percent by 1995, slightly increasing their share of the GNP. Banking and financial services have been expanding rapidly in recent years and their expansion is projected to pick up speed. Professional services, medical care services, and communications services are all projected to grow more than 5 percent a year.

The government's share of the GNP is projected to decline from 18.8 percent in 1984 to 18.0 percent in 1995. The Federal share is projected to remain about the same, although a shift from nondefense to defense expenditures is expected. State and local expenditures, however, are projected to drop from 11.4 to 10.7 percent of GNP. In large part, the smaller share is a result of population trends. Spending on education, the largest component of State and local government expenditures, will rise much more slowly than the GNP because of the very slow growth of the population of 5- to 17-year-olds.

The portion of GNP devoted to investment includes purchases of equipment and construction of commercial and residential buildings. Equipment purchases account for the largest portion of business investment; they are projected to grow 3.8 percent a year, somewhat faster than the GNP as a whole. Purchases are likely to be highly concentrated in technologically advanced equipment such as computers, advanced communication equipment, robots, and highly automated metal-cutting tools. Long-term housing demand is mainly determined by demographic factors and geographic movement. Primarily because of the projected slowdown in population growth and changes in the age structure of the population, the number of housing starts in 1995 is projected to be slightly lower than the current rate.

Foreign trade makes up the remaining portion of GNP Computers, electronic components, communications equipment, and medical drugs are expected to be a larger percentage of the merchandise exported, while aircraft, motor vehicles, and agricultural products continue to be exported in large amounts. Many of the same items, including motor vehicles, computers, and electronic components, show up on lists of imports. Crude petroleum and natural gas and apparel products will still make up a substantial share of the import market.

Employment by Industry

During the 25 years up to 1984, the U.S. economy added nearly 40 million jobs, about 3 million of which were in manufacturing. All the rest were gained in services, the growth of which also absorbed the impact of jobs lost in declining industries, such as agriculture. Many of the shifts in employment seen over this period are projected to continue to 1995. The employment shift to services is one of these, with job growth expected in industries such as business services, health care, professional services, and others.

The lion's share of new jobs will be in the service industries, according to the projections. Almost 9 out of every 10 of the 16 million projected new jobs will be in a service-producing industry, with business services alone accounting for 6 jobs in 10. The goods-producing industries as a whole will grow only slightly, and several will decline.

The projections of industry employment are based in part on the projected GNP discussed above. They also depend on projections of productivity by industry and measures of change in the number of hours worked. Among the assumptions that enter into the projections are that the number of hours worked per week will continue to decline and productivity will increase smartly, largely because of increased investment in capital goods. Specific assumptions are also made with regard to the effects of rising energy costs, the increased affordability of electronic components, the changing age structure of the population, and many other factors that have important effects on particular industries. Employment projections are made for 378 industries.

Occupational Employment

The growth of particular occupations depends on general economic developments, changes in technology, the growth of particular industries, and institutional changes, such as the use of paraprofessionals to perform some of the duties formerly carried out by professionals. Thus the projections of occupational employment rely on the industrial projections discussed above as well as analysis of individual occupations. More information about the development of occupational projections appears in the introduction to "The Job Outlook in Brief,' which appears in the front of this magazine. The "Brief,' however, deals only with the occupations that are analyzed for the Occupational Outlook Handbook. The following lists are based on projected changes in more than twice as many occupations.

Growth can be viewed in two ways: Rate and absolute numbers. In terms of growth rate, the five fastest growing occupations are paralegal personnel, computer programmers, computer systems analysts, medical assistants, and data processing equipment repairers. The occupations are obviously related to the projected changes in spending for goods and services described above as well as institutional changes.

The following 20 occupations have the highest projected growth rates:

Paralegal personnel

Computer programmers

Computer systems analysts, electronic data processing

Medical assistants

Data processing equipment repairers

Electrical and electronics engineers

Electrical and electronics technicians and technologists

Computer operators, except peripheral equipment

Peripheral EDP equipment operators

Travel agents

Physical therapists

Physician assistants

Securities and financial services sales workers

Mechanical engineering technicians and technologists

Lawyers

Correction officers and jailers

Accountants and auditors

Mechanical engineers

Registered nurses

Employment interviewers, private or public employment service

Many of these occupations are relatively small, employing fewer than 50,000 people. Obviously, such small occupations cannot provide large numbers of new jobs even if they are growing rapidly. In terms of numbers of new jobs, therefore, a very different list emerges. Just 37 of the 500 occupations analyzed will account for about one-half of all job growth between 1984 and 1995. About one-fourth of the occupations generally require a college degree, roughly the same proportion found among all jobs in the economy. Besides growth, many of these large occupations will offer numerous replacement jobs.

The following 37 occupations have the largest projected employment growth:

Cashiers

Registered nurses

Janitors and cleaners, including maids and household cleaners

Truckdrivers

Waiters and waitresses

Wholesale trade sales workers

Nursing aides, orderlies, and attendants

Sales workers, retail

Accountants and auditors

Teachers, kindergarten and elementary

Secretaries

Computer programmers

General office clerks

Food preparation workers, excluding fast food

Food preparation, fast food

Computer systems analysts, electronic data processing

Electrical and electronics engineers

Electrical and electronics technicians and technologists

Guards

Automotive and motorcycle mechanics

Lawyers

Cosmetologists and related workers

Cooks, restaurant

Maintenance repairers, general utility

Bookkeeping, accounting, and auditing clerks

Bartenders

Computer operators, excluding peripheral equipment

Physicians and surgeons

Licensed practical nurses

Carpenters

Switchboard operators

Food service and lodging managers

Electricians

Teacher aides and educational assistants

Blue-collar worker supervisors

Receptionists and information clerks

Mechanical engineers

Technology is expected to slow growth or cause actual declines in some occupations while it stimulates the growth of others. For example, the increased use of word processing equipment will slow the growth of typists. Most of the declining occupations are concentrated in industries that have recently shrunk and are expected to continue shrinking. Several are in the apparel and textile industries. Other declining occupations are in railroad transportation, agriculture, and private households. Occupations that are expected to be affected adversely by technological changes are stenographers, industrial truck and tractor operators, telephone station intallers and repairers, and statistical clerks.
COPYRIGHT 1986 U.S. Government Printing Office
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1986 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Title Annotation:of job vacancies in the United States
Author:Baxter, Neale
Publication:Occupational Outlook Quarterly
Date:Mar 22, 1986
Words:2226
Previous Article:The job outlook in brief.
Next Article:You're a what? nurse-midwife.
Topics:

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters