system, which is designed to capture the changes in the labor market, and with which SSA hopes to assess the demands of contemporary jobs.
Although it would be hazardous to predict what the labor market will be like in the distant future, several of the most important trends have been unfolding for several decades and can be expected to continue in the years to come (Bell, 1983; Hirschhorn, 1988; Levy, 1987; Piore and Sabel, 1984; Wilson, 1997). These trends include a relative shift from goods-producing occupations and industries to the distribution of services; the increasing demand for highly skilled and highly trained labor and the erosion of demand for those with less skill and training; the emergence of new ways of accomplishing work within the firm; and the emergence of alternative work arrangements throughout the economy.
Some of these trends are relatively easy to quantify, for example, the growth of jobs in services. Some are more difficult to measure and evaluate, for example, the growth of contingent employment arrangements (Belous, 1989; Polivka, 1996), the putative erosion of job security (Nardone et al., 1997), and the flattening of workplace hierarchies (Osterman, 1988). And many of the changes are not quite as dramatic as some analysts claim: much of service work is physically demanding and much of it, regardless of the physical demand, is repetitious. All, however, are difficult to translate into a simple set of instructions for assessing functional capacity for work. Indeed, if there is a message that emerges from an analysis of the trends in the labor market, it is that in the contemporary economy, the division of tasks within and among jobs is growing increasingly complex.
As work demands change, the most important characteristic of those capable of thriving may be the ability to do multiple tasks in an overlapping and constantly evolving series of relationships and to adapt to new responsibilities. The problem facing the SSA is a daunting one: how to assess an individual's capacity to do a complex mix of tasks now and to learn a new mix later.
Dynamics in Labor Force Participation. The 1950s and 1960s are viewed by some as the halcyon era in the U.S. economy, with high growth rates sustaining unprecedented increases in the standard of living, allowing most families to survive on one income, and in turn, reinforcing the social ethic of the time that women should not work outside the home (Levy, 1987). In 1960, just under 60 percent of the working age population was in the labor force (Table 2-1). The overall labor force participation rate has increased by more than 12 percent in the interim, having reached almost two-thirds as of 1996.
Gender. This overall increase in labor force participation rates masks substantial differences by gender and age. Among all working age men, labor force participation rates declined by more than 10 percent, but men 55 to 64 years old experienced an even steeper decline, 22.8 percent (Table 2-1). Conversely, among all