Economic Report of the President

at an approach that took account of the legitimate concerns of allgroups and at the same time furthered the national interest. Dealingwith the Nation's remaining economic problems will also requirepainful measures and the reconciliation of a number of different interests.Our handling of the energy problem should raise our confidencethat we can be successful elsewhere.We have also had major successes in other fields. After decades ofinaction, the past 4 years have seen the elimination of price-proppingand competition-deadening regulations in a number of American industries.In these 4 years we witnessed more progress in economicderegulation than at any other time in the century. In the face ofgreat skepticism and initial opposition, the executive branch, theCongress, and some of the independent regulatory agencies havederegulated or drastically reduced regulation in the airline, trucking,and railroad industries, and in banking and other financial institutions.We have also made a promising start in the communicationsindustry. The transportation, communications, and finance industriescomprise a triad that links the various strands of our economy together.Better performance in these industries should have effects farbeyond their own boundaries.The gains from deregulation will be substantial. For example, productivityand efficiency will be directly increased as transportationload factors are improved and empty backhauls reduced. One surveyof studies estimates that reform in the trucking industry alone willlead to $5 billion in annual cost reductions. Even more importantwill be the longer-run spur to innovation and the increased flexibilitythat comes from opening up these industries to the fresh winds ofcompetition.Population trends will be working to help the country deal withsome of its economic problems in the 1980s, whereas in the late1960s and 1970s these trends required some difficult adjustments.The generation of the postwar baby boom began entering the labormarket in the 1960s and the influx of new workers continued duringthe 1970s. The percentage of the population aged 16 to 24 rosesharply. And as birth rates slowed, women entered the labor force inever increasing numbers. On average, the labor force became less experienced,and average productivity per worker suffered. The increasedproportion of women and young people in the labor forcealso contributed to an increase in the average unemployment rate becausethe transition from school or home to job takes time and becausethese new workers sometimes had periods of unemployment asthey explored different career possibilities.Because of the slowdown in birth rates in the past 15 years, the1980s will see about half as fast a growth in the labor force as in the