Niche shock: And how to survive it

Unless we recognize what is unique about today's business environment, our best laid plans are almost sure to end in frustration, and perhaps failure. We're living in an unusual era, one in which the drama of rampant economic change is being performed under the subtle constraints of slow economic growth. Consider three fundamentals—people, jobs, and income. As you can see in Exhibit 1, all have been growing slowly in the 1980s as compared with prior decades. Yet, as I write this, the nightly news is announcing another economic milestone—U.S. consumers now have over 500 makes and models of VCRs to choose from. Exhibit 2 provides a picture of year‐to‐year changes as well as a five‐year moving average to demonstrate that the trend in U.S. growth rates is definitely downward, and that the variability above and below this trend has been increasing in the last decade.