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Have jobs and wages stopped rising? Productivity and structural change in advanced countries

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  • Compagnucci, Fabiano
  • Gentili, Andrea
  • Valentini, Enzo
  • Gallegati, Mauro

Abstract

This paper is aimed at studying the long run relationship between GDP per capita growth and the job “required” by such a growth. This relationship, which has been positive for a long period after World War II, leading to a more equal and wealthy society via the labour market, turned out to be non-positive since the middle of the 1980s, giving rise to the so-called ”Jobless Growth” and “Jobless Recovery” phenomena. By analysing data from STAN databases throughout the period 1970–2015, we found that the break in the relation between GDP per capita growth and employment can be explained by the decoupling between productivity from one hand, and labour compensation and utilisation from the other. Our findings further suggest that different economic sectors specifically contributed to the productivity change in accordance with their technological and knowledge intensity.

Suggested Citation

  • Compagnucci, Fabiano & Gentili, Andrea & Valentini, Enzo & Gallegati, Mauro, 2021. "Have jobs and wages stopped rising? Productivity and structural change in advanced countries," Structural Change and Economic Dynamics, Elsevier, vol. 56(C), pages 412-430.
    • Handle: RePEc:eee:streco:v:56:y:2021:i:c:p:412-430
    DOI: 10.1016/j.strueco.2018.07.003
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    Cited by:

    1. Andrea Gentili & Fabiano Compagnucci & Mauro Gallegati & Enzo Valentini, 2020. "Are machines stealing our jobs?," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 13(1), pages 153-173.
    2. Jorge Antunes & Goodness C. Aye & Rangan Gupta & Peter Wanke & Yong Tan, 2020. "Endogenous Long-Term Productivity Performance in Advanced Countries: A Novel Two-Dimensional Fuzzy-Monte Carlo Approach," Working Papers 2020111, University of Pretoria, Department of Economics.

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    More about this item

    Keywords

    Labour productivity; Jobless growth; Decoupling; Structural change;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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