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The Growth of Low Skill Service Jobs and the Polarization of the U.S. Labor Market

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Author Info

  • Autor, David

    ()
    (MIT)

  • Dorn, David

    ()
    (University of Zurich)

Abstract

We offer an integrated explanation and empirical analysis of the polarization of U.S. employment and wages between 1980 and 2005, and the concurrent growth of low skill service occupations. We attribute polarization to the interaction between consumer preferences, which favor variety over specialization, and the falling cost of automating routine, codifiable job tasks. Applying a spatial equilibrium model, we derive, test, and confirm four implications of this hypothesis. Local labor markets that were specialized in routine activities differentially adopted information technology, reallocated low skill labor into service occupations (employment polarization), experienced earnings growth at the tails of the distribution (wage polarization), and received inflows of skilled labor.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 7068.

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Length: 58 pages
Date of creation: Dec 2012
Date of revision:
Publication status: published in: American Economic Review, 2013, 103(5), 1553-1597
Handle: RePEc:iza:izadps:dp7068

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Related research

Keywords: skill demand; job tasks; inequality; polarization; technological change; service occupations; occupational choice;

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  1. Profesiones con o sin empleo: la polarización ocupacional
    by Florentino Felgueroso in Nada Es Gratis on 2011-05-08 13:22:40
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