Final answer:
Factors such as the internet making job searches more efficient, the rise of the temp worker industry, and the aging of the baby boom generation have contributed to a lower natural rate of unemployment in the U.S. in recent years.
Step-by-step explanation:
Several factors have decreased the natural rate of unemployment in the United States in recent years, leading to a lower average unemployment rate in the 1990s and early 2000s compared to the 1980s.
First, the advent of the internet and social networking platforms, like LinkedIn, have simplified job searching and made it more efficient, allowing job seekers to easily connect with potential employers.
Second, the growth of the temporary worker industry has presented a significant reduction in frictional unemployment by acting as a bridge for workers to find permanent positions.
Lastly, the changing demographics with the aging baby boom generation have resulted in fewer younger workers entering the labor market, who typically have higher unemployment rates than middle-aged and older workers.
For instance, estimates by economists in the early 2000s pegged the natural rate of unemployment at about 4.5 to 5.5%, a decline from earlier estimates.