Stagflation again?

A question from Yahoo! Answers:

Are we headed for a stagflationary period, simular to the 1970s??

With the rise in gas prices, rising interest rates, and sluggish job growth, our economic climate is very simular to the 1970s. Any thoughts on what the rest of the decade looks life for the US economy??

There are at least two major differences between now and 1970s. One is the productivity growth, which was unusually sluggish in the 1970s and is unusually robust now. The other is demographics. U.S. population today is much older than it was in 1970s. Now keep in mind that productivity growth typically steers clear of healthcare and education, and what do you see? A (junk?) job explosion in healthcare in general and elderly care in particular. California’s Employment Development Department already considers Home Health Aide to be an occupation (and a high-growth one, too), and it is likely that millions of people all over the country are going to be employed in this and similar occupations. Median annual salary for a Home Health Aide in California? $19,000.

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