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Regional diversification and labour market upgrading: local access to skill-related high-income jobs helps workers escaping low-wage employment

Author

Listed:
  • Zoltán Elekes
  • Anna Baranowska-Rataj
  • Rikard Eriksson

Abstract

This article investigates how the evolution of local labour market structure enables or constrains workers as regards escaping low-wage jobs. Drawing on the network-based approach of evolutionary economic geography, we employ a detailed individual-level panel dataset to construct skill-relatedness networks for 72 functional labour market regions in Sweden. Subsequent fixed-effect panel regressions indicate that increasing density of skill-related high-income jobs within a region is conducive to low-wage workers moving to better-paid jobs, hence facilitating labour market upgrading through diversification. While metropolitan regions offer a premium for this relationship, it also holds for smaller regions, and across various worker characteristics.

Suggested Citation

  • Zoltán Elekes & Anna Baranowska-Rataj & Rikard Eriksson, 2023. "Regional diversification and labour market upgrading: local access to skill-related high-income jobs helps workers escaping low-wage employment," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 16(3), pages 417-430.
    • Handle: RePEc:oup:cjrecs:v:16:y:2023:i:3:p:417-430.
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    File URL: http://hdl.handle.net/10.1093/cjres/rsad016
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