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We Can Work It Out: the Impact of Technological Change on the Demand for Low Skill Workers

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Author Info
Alan Manning
Abstract

There is little doubt that technology has had the most profound effect on altering the tasks that wehumans do in our jobs. Economists have long speculated on how technical change affects boththe absolute demand for labour as a whole and the relative demands for different types of labour.In recent years, the idea of skill-biased technical change has become the consensus view aboutthe current impact of technology on labour demand, namely that technical change leads to anincrease in the demand for skilled relative to unskilled labour painting a bleak future for theemployment prospects of less-skilled workers. But, drawing on a recent paper by Autor, Levyand Murnane (2003) about the impact of technology on the demand for different types of skills,this paper argues that the demand in the least-skilled jobs may be growing. But, it is argued thatemployment of the less-skilled is increasingly dependent on physical proximity to the moreskilledand may also be vulnerable in the long-run to further technological developments.

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Paper provided by Centre for Economic Performance, LSE in its series CEP Discussion Papers with number dp0640.

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Date of creation: Jun 2004
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Handle: RePEc:cep:cepdps:dp0640

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Related research
Keywords: Labor Demand and Technology; Inequality;

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Find related papers by JEL classification:
J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure

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  1. A. Gautier, Pieter & J. van den Berg, Gerard & C. van Ours, Jan & Ridder, Geert, 2002. "Worker turnover at the firm level and crowding out of lower educated workers," European Economic Review, Elsevier, vol. 46(3), pages 523-538, March. [Downloadable!] (restricted)
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  2. Giles Duranton & Diego Puga, 2003. "Micro-Foundations of Urban Agglomeration Economies," NBER Working Papers 9931, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  3. Enrico Moretti, 2002. "Human Capital Spillovers in Manufacturing: Evidence from Plant-Level Production Functions," NBER Working Papers 9316, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  4. Teulings, Coen & Koopmanschap, Marc, 1989. "An econometric model of crowding out of lower education levels," European Economic Review, Elsevier, vol. 33(8), pages 1653-1664, October. [Downloadable!] (restricted)
  5. Maarten Goos & Alan Manning, 2003. "Lousy and Lovely Jobs: the Rising Polarization of Work in Britain," CEP Discussion Papers dp0604, Centre for Economic Performance, LSE. [Downloadable!]
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  6. Ciccone, Antonio & Peri, Giovanni, 2002. "Identifying Human Capital Externalities: Theory with an Application to US Cities," IZA Discussion Papers 488, Institute for the Study of Labor (IZA). [Downloadable!]
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  7. David Autor & Frank Levy & Richard Murnane, 2003. "The skill content of recent technological change: an empirical exploration," Proceedings, Federal Reserve Bank of San Francisco, issue Nov. [Downloadable!]
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  8. van Ours, J. C. & Ridder, G., 1995. "Job matching and job competition: Are lower educated workers at the back of job queues?," European Economic Review, Elsevier, vol. 39(9), pages 1717-1731, December. [Downloadable!] (restricted)
  9. Paul Gregg & Stephen Machin & Alan Manning, 2004. "Mobility and Joblessness," NBER Chapters, in: Seeking a Premier Economy: The Economic Effects of British Economic Reforms, 1980-2000, pages 371-410 National Bureau of Economic Research, Inc. [Downloadable!]
  10. David Card & Thomas Lemieux, 2001. "Can Falling Supply Explain The Rising Return To College For Younger Men? A Cohort-Based Analysis," The Quarterly Journal of Economics, MIT Press, vol. 116(2), pages 705-746, May. [Downloadable!] (restricted)
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  11. David Card & John E. DiNardo, 2002. "Skill-Biased Technological Change and Rising Wage Inequality: Some Problems and Puzzles," Journal of Labor Economics, University of Chicago Press, vol. 20(4), pages 733-783, October. [Downloadable!]
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  12. Acemoglu, Daron, 2002. "Directed Technical Change," Review of Economic Studies, Blackwell Publishing, vol. 69(4), pages 781-809, October.
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  13. Enrico Moretti, 2003. "Human Capital Externalities in Cities," NBER Working Papers 9641, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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