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

  • Alan Manning
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    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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    File URL: http://cep.lse.ac.uk/pubs/download/dp0640.pdf
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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
    Contact details of provider: Web page: http://cep.lse.ac.uk/_new/publications/series.asp?prog=CEP

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    1. 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.
    2. 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.
    3. Enrico Moretti, 2003. "Human Capital Externalities in Cities," NBER Working Papers 9641, National Bureau of Economic Research, Inc.
    4. David Card & Thomas Lemieux, 2000. "Can Falling Supply Explain the Rising Return to College for Younger Men? A Cohort-Based Analysis," NBER Working Papers 7655, National Bureau of Economic Research, Inc.
    5. Ciccone, Antonio & Peri, Giovanni, 2002. "Identifying Human Capital Externalities: Theory with an Application to US Cities," CEPR Discussion Papers 3350, C.E.P.R. Discussion Papers.
    6. 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.
    7. Maarten Goos & Alan Manning, 2007. "Lousy and Lovely Jobs: The Rising Polarization of Work in Britain," The Review of Economics and Statistics, MIT Press, vol. 89(1), pages 118-133, February.
    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.
    9. Gautier, P.A. & van den Berg, G. & van Ours, J.C. & Ridder, G., 2002. "Worker turnover at the firm level and crowding out of lower educated workers," Other publications TiSEM 8ea33399-69d3-480a-a241-c, Tilburg University, School of Economics and Management.
    10. Daron Acemoglu, 2001. "Directed Technical Change," NBER Working Papers 8287, National Bureau of Economic Research, Inc.
    11. Sen, Amartya, 1983. "Poverty and Famines: An Essay on Entitlement and Deprivation," OUP Catalogue, Oxford University Press, number 9780198284635, March.
    12. David Card & John E. DiNardo, 2002. "Skill Biased Technological Change and Rising Wage Inequality: Some Problems and Puzzles," NBER Working Papers 8769, National Bureau of Economic Research, Inc.
    13. Enrico Moretti, 2002. "Human Capital Spillovers in Manufacturing: Evidence from Plant-Level Production Functions," Working Papers 02-27, Center for Economic Studies, U.S. Census Bureau.
    14. Duranton, Gilles & Puga, Diego, 2003. "Microfoundations of Urban Agglomeration Economies," CEPR Discussion Papers 4062, C.E.P.R. Discussion Papers.
    15. Daron Acemoglu & Joshua Angrist, 2001. "How Large are Human-Capital Externalities? Evidence from Compulsory-Schooling Laws," NBER Chapters, in: NBER Macroeconomics Annual 2000, Volume 15, pages 9-74 National Bureau of Economic Research, Inc.
    16. Leontief, Wassily & Duchin, Faye, 1986. "The Future Impact of Automation on Workers," OUP Catalogue, Oxford University Press, number 9780195036237, March.
    17. 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.
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