Although there is growing recognition that services play a major role in developed economies, knowledpe concerning the service sector, including its spatial characteristics. is quite limited. This study examines the spatial structure of the U.S. service sector and change in that structure from 1958 to 1977. It is based on an analysis of service employment and employment change for a sample of U . S . SMSAs and nonmetropolitan areas. Most of the change in service structure that took place during the study period was focused in business and professional services and in finance, insurance, and real estate. Many individual industries in these groupings exhibited both downfiltering from larger to smaller places and very strong growth in the South. As a result, the South reversed its relative deficiency in many specialized services. A relationship between total employment growth and both the concentration in and relative growth of business, professional, and financial services was observed. Study results suggest that regional development policies that foster service growth could benefit not only large SMSAs but many smaller places as well.

Information-intensive producer services, which constitute one of the fastest growing components of the U.S. economy, have been identified as a potential contributor to economic development in rural areas. This issue is examined in a case study of a community in rural Washington State. The findings indicate that producer services have not been decentralizing to rural Washington, and that opportunities for producer services development in rural communities are limited because of the inaccessibility of markets, smaller pools of skilled labor, and the lack of agglomeration economies. Opportunities for producer services are greatest in large rural communities with high-quality telecommunications systems. Although the quality of telecommunications systems is important to the economic health of communities, advances in telecommunications can be a two-way street for rural America. While telecommunications improvements increase a rural community's access to information and make it possible for rural businesses to more easily serve non-local markets, they can also make it easier for firms located in urban areas to serve rural markets via branch offices or through the telecommunications system. HE DECADE OF THE 1980s HAS BEEN A TIME of economic distress forT much of rural America, as many rural communities have experienced declines in traditional basic industries along with job loss, high unemployment, and an out-migration of people. At the same time, service activities-particularly information-intensive producer services-have been growing rapidly. Given the problems of rural America on the one hand and the growth of producer services on the other, there has been increasing interest in the idea that producer service activities can stimulate economic development in rural areas.Thomas . I . Kirn and Richard S . Conway, Jr., are Senior Research Analyst and Principal, respectively, of Dick Conway & Associates, 2323 Eastlake Avenue 5 ra hy at the University of Washington, Seattle WA 98195. The authors would like to acknowledge the financial support and assistance of the Washington Department of Community Development, and to thank William Blazar for his valuable contributions and Glen Pulver for his helpful advice. ast, Suite 410, Seattle WA 98102, and William B. Beyers is a professor of geog-

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