SPATIAL ASPECTS OF STRUCTURAL CHANGE
| Author | Sheldon E. Haber |
| Published date | 01 February 1974 |
| Date | 01 February 1974 |
| DOI | http://doi.org/10.1111/j.1467-9485.1974.tb00174.x |
Scottish Journal
of
Political
Economy
Vol.
XXI,
No.
1,
February
1974
SPATIAL ASPECTS
OF
STRUCTURAL CHANGE
SHELDON
E.
HABER*
An important problem
in
formulating a proper mix
of
policies to meet the
challenge of structural change is the assessment
of
the impact
of
such change
on labour markets.
In
recent years
this
assessment
has
been
carried
out,
almost exclusively, in terms
of
the structure of unemployment rates. The
major thrust
of
this
paper is
a
methodological one in that it questions the
appropriateness of this approach and suggests that labour
force
participation
rates are mone appropriate. In the discussion that follows. attention is
focused on labour supply adjustments in labour markets defined in terms of
spatial characteristics. The particular choice of sectoring labour markets by
geographical location was influenced by the attention that has been directed
to the problem of depressed areas.' Since labour market adjustment among
geographical areas is an important aspect
of
structural change, the methodo-
logical issue raised is germane to the more general structural-deficient aggre-
gate demand controversy.
In Section
I,
a brief review of studies using the unemployment rate as a
basis for measuring structural change is presented. In Section
11,
the labour
market adjustment process is viewed in terms of its implications regarding
changes in labour force participation rates. In Section
111,
unemployment
and labour force data for the United States classified by
region,
state and
Standard Metropolitan Statistical Area (SMSA) are used to measure labour
market adjustment to structural change. Contrary
to
the conclusions drawn
in earlier studies based
on
the structure
of
unemployment
rates,
the labour
force data suggest *that in areas where the demand for labour does not
grow
rapidly, the proportion
of
the
workingage population participating
in
the
production
of
output falls or does not increase by much.
In
these labour
markets structural change has an adverse impact.
I
STRUCTURAL CHANGE AND THE STRUCTURE
OF
UNEMPLOYMENT
RATES
A
number of methods based
on
the structure
of
unemployment rates have
been used to assess the impact
of
structural change
on
labour markets. One
*The study is an outgrowth of earlier research performed for the Economic
Development Administration. The George Washington University Computing Center
provided computational assistance for which thanks is acknowledged.
Extensions to sectoral classifications based
on
industry and occupation could
not be accommodated since a population base for computing labour force participa-
tion rates cannot be identified for these groupings. This reason alone provides an
explanation for the almost exclusive use of the unemployment rate in measuring
the impact of structural change.
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