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Individual Consequences of Occupational Decline

Author

Listed:
  • Per-Anders Edin
  • Tiernan Evans
  • Georg Graetz
  • Sofia Hernnäs
  • Guy Michaels

Abstract

What are the earnings and employment losses that workers suffer when demand for their occupations declines? To answer this question we combine forecasts on occupational employment changes, which allow us to identify unanticipated declines; administrative data on the population of Swedish workers, spanning several decades; and a highly detailed occupational classification. We find that, compared to similar workers, those facing occupational decline lost about 2-5 percent of mean cumulative earnings from 1986-2013. But workers at the bottom of their occupations’ initial earnings distributions suffered considerably larger losses. These earnings losses are partly accounted for by reduced employment, and increased unemployment and retraining.

Suggested Citation

  • Per-Anders Edin & Tiernan Evans & Georg Graetz & Sofia Hernnäs & Guy Michaels, 2019. "Individual Consequences of Occupational Decline," CESifo Working Paper Series 7720, CESifo Group Munich.
  • Handle: RePEc:ces:ceswps:_7720
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    File URL: https://www.cesifo-group.de/DocDL/cesifo1_wp7720.pdf
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    Keywords

    technological change; occupations; inequality;

    JEL classification:

    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion

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