Prominent Labor Economists Said M-Form Soceity Has Arrived in the US

Here's the hypothesis evolving among these and other academics. Technology and globalization are boosting demand for the most-educated workers, those prized for abstract or conceptual skills. Top hedge-fund managers aren't being replaced by computers; they're harnessing them, to their great profit.

By contrast, technology and globalization are eroding demand for workers who do routine tasks in factories and offices, many of whom are high-school or even college grads. The voice-mail system does away with switchboard operators; back-office software eliminates bookkeepers; robots replace assembly-line workers. Or the work is shipped overseas to a foreign factory or an office linked to the U.S. by fiber-optic cables.

But technology and globalization are not eroding demand for personal-service workers. Those tasks can't be done by computer or shipped offshore. The services have to be delivered here in the U.S. -- and in person -- either by natives or by immigrants.

Here's more from WSJ.

Why Demand for Signalling Surged?

Gary Becker and Kevin Murphy, two of the best minds in labor economics, contributed an article on the cause of rising income inequality in the US in the latest issue of The American, read it here.

Becker and Murphy attribute the rising income gap as an outcome of the increasing demand for skilled labor (with skilled labor defined as those who get more years of schooling). As I am a believer of the signalling theory of education, the puzzle is why there is a surge in the demand for more signalling among job seekers? Is it the changing structure of the economy (computer, internet...service sector growth in general)? What is so special about an investment bank job or a computer coding job which requires more signalling on the part of job seekers' type compared with say a car manufacturing job in Detriot? I don't have the answer, do you?