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The Anatomy of Polarization: Evidence from Worker Flows

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Abstract

Using longitudinal French administrative data (1984–2021), we document that employment polarization after 1994 reflects major changes in labor-market entry rather than mass occupational downgrading or displacement of incumbents. Flows from routine to abstract occupations remain substantial throughout the period, and a large fraction of these upgrades is due to noncollege workers. The decisive shift that generates polarization occurs at the entry margin: the net flow from nonemployment into routine occupations reverses around 1994, while the net flow from nonemployment into manual work increases. These patterns motivate life-cycle models of occupational choice that explicitly incorporate cohort heterogeneity and separate entry and re-entry margins.

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  • Fabio Cerina & Elisa Dienesch & Alexander Monge-Naranjo & Alessio Moro, 2026. "The Anatomy of Polarization: Evidence from Worker Flows," FRB Atlanta Working Paper 2026-7, Federal Reserve Bank of Atlanta.
    • Handle: RePEc:fip:fedawp:103416
    DOI: 10.29338/wp2026-07
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    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • 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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