Is The Unskilled Worker Problem In Developed Countries Going Away?

Recent data suggest that the fortunes of unskilled workers in developed countries improved during the 1990s, after deteriorating significantly during the 1980s. Such a trend could be explained by a faster decline in the relative supply of unskilled labour, a slower decline in the relative demand for unskilled labour, or a shift in labour market institutions. This paper argues that the improvement almost always reflected a slower decline in relative demand. Further research will be required to discover why the decline in demand for unskilled labour decelerated.