The Nation - News from May 7, 1989

Service-sector growth in the economy will slow dramatically, according to a new study. “For the past 40 years, service employment has supplied the bulk of the new jobs in the United States, and for the past 10 years all of them. In the decade ahead this pattern is apt to change,” Lester Thurow of the Massachusetts Institute of Technology wrote in a study for the Economic Policy Institute, a liberal think tank. Job growth in health care, restaurants, retail sales and financial and legal services is likely to be much lower because of declining demand, said the study. Meanwhile, manufacturing jobs are likely to increase as the United States tries to reduce its trade deficit by exporting more goods and buying fewer imports, it said. “Eventually, the dollar will fall to whatever level is necessary for the United States to balance its international accounts,” Thurow concluded in the study. “At that point the United States will either export more manufactured goods or replace imported manufactured goods with domestically made alternatives.”