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Disappearing routine jobs: Who, how, and why?

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  • Cortes, Guido Matias
  • Jaimovich, Nir
  • Siu, Henry E.

Abstract

We study the deterioration of employment in middle-wage, routine occupations in the United States in the last 35 years. The decline is primarily driven by changes in the propensity to work in routine jobs for individuals from a small set of demographic groups. These same groups account for a substantial fraction of both the increase in non-employment and employment in low-wage, non-routine manual occupations observed during the same period. We analyze a general neoclassical model of the labor market featuring endogenous participation and occupation choice. In response to an increase in automation technology, the framework embodies a tradeoff between reallocating employment across occupations and reallocation of workers towards non-employment. Quantitatively, we find that this standard model accounts for a relatively small portion of the joint decline in routine employment and associated rise in non-routine manual employment and non-employment.

Suggested Citation

  • Cortes, Guido Matias & Jaimovich, Nir & Siu, Henry E., 2017. "Disappearing routine jobs: Who, how, and why?," Journal of Monetary Economics, Elsevier, vol. 91(C), pages 69-87.
    • Handle: RePEc:eee:moneco:v:91:y:2017:i:c:p:69-87
    DOI: 10.1016/j.jmoneco.2017.09.006
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    More about this item

    Keywords

    Routine occupations; Job polarization; Automation; Labor force participation;
    All these keywords.

    JEL classification:

    • E0 - Macroeconomics and Monetary Economics - - General
    • J0 - Labor and Demographic Economics - - General

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