For office innovators, the unrealized dream of the “paperless” office is a classic example of high-tech hubris. Today’s office is drowning in more paper than ever before. But after decades of hype, American offices may finally be losing their paper obsession. The demand for paper used to outstrip the growth of the U.S. economy, but the past two or three years have seen a marked slowdown in sales—despite a healthy economic scene. Analysts attribute the decline to such factors as advances in digital databases and communication systems. Escaping our craving for paper, however, will be anything but an easy affair.

In the early to mid-1990s, a booming economy and improved desktop printers helped boost paper sales by 6 to 7 percent each year. But now, plain white office paper will see less than a 4 percent growth rate, despite the strong overall economy. A primary reason for the change is that for the first time ever, some 47 percent of the workforce entered the job market after computers had already been introduced to offices. In addition, analysts point to the lackluster employment market for white-collar workers—the primary driver of office paper consumption—for the shift in paper usage.

The changing attitudes toward paper have finally caught the attention of paper companies, says Richard Harper, a researcher at Microsoft. “All of a sudden, the paper industry has started thinking, ’We need to learn more about the behavioral aspects of paper use,’” he says. To reduce paper use, some companies are working to combine digital and paper capabilities. For example, Xerox Corp. is developing electronic paper: thin digital displays that respond to a stylus, like a pen on paper. Notations can be erased or saved digitally. Another idea, intelligent paper, comes from Anoto Group. It would allow notations made with a stylus on a page printed with a special magnetic ink to simultaneously appear on a computer screen.

Even with such technological advances, the improved capabilities of digital storage continue to act against “paperlessness”, argues Paul Saffo, a technology forecaster. In his prophetic and metaphorical 1989 essay, The Electronic Pinata, he wrote, “The information industry today is like a huge electronic pinata, composed of a thin paper crust surrounding an electronic core.” The growing paper crust “is most noticeable, but the hidden electronic core that produces the crust is far larger—and growing more rapidly. The result is that we are becoming paperless, but we hardly notice at all.”

In the same way that digital innovations have increased paper consumption, Saffo says, so has video conferencing—with its promise of fewer in-person meetings—booming business travel. “That’s one of the great ironies of the information age” Saffo says. “It’s just common sense that the more you talk to someone by phone or computer, it inevitably leads to a face-to-face meeting.”

Which of the following is the reason for the slowdown in paper sales?