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The demographic changes currently underway in the United States have been widely anticipated and discussed by scholars and practitioners, but little is known about what impacts, if any, have already been experienced by employers. This article reports on a field study that asked managers in large US corporations to describe how and to what extent demographic changes have affected their businesses. Changing work force demographics were interpreted by managers as having two distinct components: a reduction in the growth rate and quality of potential employees, and increased gender, ethnic, and age diversity. While most firms reported managerial challenges from increased diversity, none characterized it as a serious business problem. A lack of sufficiently skilled workers for increasingly complex jobs, conversely, was seen as a major, ongoing problem.

The authors describe a theory of organization developed by Lawrence and Lorsch which related organizational differentiation and integration to environmental demands. Several studies which have attempted to employ the theory in school settings are discussed and the paper describes some of the promises and problems asso ciated with and implications for using the theory in educational organizations. In particular, the authors discuss applications of the concepts for studying urban school systems as complex organiza tions. C. Brooklyn Derr is an Assistant Professor and Research Associate at the Harvard Graduate School of Education. John J. Gabarro is an Assistant Professor at the Harvard Graduate School of Business Administration.

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