FRBSF Economic Letters

Economic analysis for a general audience

John C. Williams


Despite the very real struggles that some parts of the country, including Alaska, are facing, the broader national economy is in good shape: We’re at full employment, and inflation is well within sight of, and on track to reach, our target. Under these conditions, it makes sense for the Fed to gradually move interest rates toward more normal levels. The following is adapted from a presentation by the president and CEO of the Federal Reserve Bank of San Francisco to the Anchorage Economic Development Corporation in Anchorage, Alaska, on August 18.

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Analysis of current economic developments and the outlook

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Working Papers

The latest in economic research

Robert G. Valletta

Wage gaps between U.S. workers with a college or graduate degree and those with a high school degree rose rapidly in the 1980s. Since then, the growth rate of these wage gaps has slowed, and the gaps were essentially unchanged between 2010 and 2015. I assess this flattening based on two related explanations for changing U.S. employment patterns: a technology-driven shift away from middle-skilled jobs (“polarization”) and generally weaker demand for advanced cognitive skills (“skill downgrading”). My analyses suggest both factors have contributed to the flattening of wage premiums.

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