TRANSITION TO SERVICE ECONOMY

The dominance of service jobs in the economy became undeniable. By the mid-1980s, capping a trend underway for more than half a century, three-fourths of all employees worked in the service sector— for instance, as retail clerks, office workers, teachers, physicians and other health care professionals, government employees, lawyers, and legal and financial specialists.

Service-sector activity benefited from the availability and increased use of the computer. This was the information age, with hardware and software that could aggregate previously unimagined amounts of data about economic and social trends. The federal government had made significant investments in computer technology in the 1950s and 1960s as part of its military and space programs. In the late 1970s two young California entrepreneurs, working out of a garage, assembled the first widely marketed computer forborne use, named it the Apple — and ignited a revolution. By the early 1980s, millions of microcomputers had found their way into U.S. businesses and homes, and in 19X2. Time magazine dubbed the computer its "Machine of the Year."

Meanwhile, America's "smokestack industries," such as steel and textiles, were in decline. The U.S. automobile industry reeled under competition from such highly efficient Japanese car makers as Toyota, Honda and Nissan — many of which opened their own factories in the United States. By 1980 Japanese automobile manufacturers controlled a quarter of the American market. Only by the late 1980s and early 1990s did U.S. manufacturers begin to match the cost efficiencies and engineering standards of their Japanese rivals, and start winning back the share of the domestic car market they had ceded to imports over the previous two decades. Although consumers were the beneficiaries of this ferocious competition - - and in other highly competitive industries, as well, such as computers—the painful struggle to cut costs meant the permanent loss of thousands of jobs in the U.S. auto industry.

Date: 2015-01-02; view: 1063