This caught my eye this morning:
US labour market to remain tight in 2007
The US labour market will remain tight next year, the White House predicted Tuesday, raising hopes that ordinary Americans will start to feel more of the benefits of the country's economic expansion.
Issuing its twice-yearly economic forecasts, White House economic advisors said unemployment would average about 4.6 per cent in 2007, only a slight bit higher than the present 4.4 per cent.
Jobs growth would average about 129,000 a month – fewer than anticipated in June, but enough to keep unemployment low due to the falling number of people joining the labour market.
Now obviously a lot of things can be going on here (not least of them politics), but why the sudden drop in new labour market entrants (only an estimated 129,000 a month)? Obviously an increase in labour market exits was to be expected as the boomers start retiring, but entrants? My intuition is that at some point the Latinos will start getting into birth postponement in a big way as they - and especially those who will have been born in the US, who will soon be coming onstream - start to go for more education, following the European American and Asian American pattern. Significantly Puerto Ricans already have 1.7tfr, and they are of course born in the US (officially speaking). So the others - with tfr of 2.8 - may well go down this road soon. Which would mean, of course, a temporary birth-dearth (this phenomenon is just not understood by hardly anyone in the US) and the Latinos moving towards lowest-low fertility, at least for a time. Remember European and Asian Americans are - on average - at EU levels of fertility (like say France or the UK) at around 1.7/1.8. So the US could very rapidly find itself with European fertility, in say 10 to 15 years. Oh deary me, whatever will the Economist blogger, and Tyler Cowan say. Clearly the responsibility will not lie with a large welfare state. It never did. Take a look at those countries with the lowest low fertility, Singapore, Croatia, Latvia, Lithuania, Spain etc etc, they are not exactly countries renowned for they high welfare levels.
Anyway, definitely something to watch. What we seem to have here are the blind leading the blind.
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