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Upskilling: do employers demand greater skill when skilled workers are plentiful?

Author

Listed:
  • Modestino, Alicia Sasser

    () (Northeastern University)

  • Shoag, Daniel

    () (John F. Kennedy School of Government)

  • Ballance, Joshua

    () (Federal Reserve Bank of Boston)

Abstract

The Great Recession and subsequent recovery have been particularly painful for low-skilled workers. From 2007 to 2012, the unemployment rate rose by 6.4 percentage points for noncollege workers while it rose by only 2.3 percentage points for the college educated. This differential impact was evident within occupations as well. One explanation for the differential impact may be the ability of highly skilled workers to take middle- and low-skilled jobs. Indeed, over this period the share of workers with a college degree in traditionally middle-skill occupations increased rapidly. Such growth in skill requirements within occupations has become known colloquially as "upskilling." It is not clear from employment outcomes alone whether the increasing share of high-skilled workers in middle- and low-skill occupations reflects changing behavior by employers. Few researchers have been able to quantify rising employer requirements due to the difficulty in isolating labor demand from labor supply. In this paper, using a novel dataset of online job vacancy postings, the authors tackle the question of whether the education and experience requirements for job postings have risen between 2007 and 2012, and if so, whether this rise was driven by the state of the local labor market.

Suggested Citation

  • Modestino, Alicia Sasser & Shoag, Daniel & Ballance, Joshua, 2015. "Upskilling: do employers demand greater skill when skilled workers are plentiful?," Working Papers 14-17, Federal Reserve Bank of Boston.
  • Handle: RePEc:fip:fedbwp:14-17
    as

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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Karolien Lenaerts & Miroslav Beblavý & Brian Fabo, 2016. "Prospects for utilisation of non-vacancy Internet data in labour market analysis—an overview," IZA Journal of Labor Economics, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 5(1), pages 1-18, December.
    2. Brad Hershbein & Lisa B. Kahn, 2018. "Do Recessions Accelerate Routine-Biased Technological Change? Evidence from Vacancy Postings," American Economic Review, American Economic Association, vol. 108(7), pages 1737-1772, July.
    3. Clifford, Robert & Shoag, Daniel, 2016. ""No More Credit Score": Emplyer Credit Check Bans and Signal Substitution," Working Paper Series 16-008, Harvard University, John F. Kennedy School of Government.
    4. Barbara Ermini & Luca Papi & Francesca Scaturro, 2017. "Over education and the great recession. The case of italian PH.D graduates," Working Papers 420, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
    5. Michael J. Handel & Alexandria Valerio & Maria Laura Sánchez Puerta, 2016. "Accounting for Mismatch in Low- and Middle-Income Countries," World Bank Publications, The World Bank, number 24906, September.
    6. Clifford, Robert & Shoag, Daniel, 2016. "“No more credit score”: employer credit check bans and signal substitution," Working Papers 16-10, Federal Reserve Bank of Boston.
    7. Beblavý, Miroslav & Fabo, Brian & Lenaerts, Karolien, 2016. "Skills Requirements for the 30 Most-Frequently Advertised Occupations in the United States: An analysis based on online vacancy data," CEPS Papers 11406, Centre for European Policy Studies.

    More about this item

    Keywords

    upskilling; middle skills; vacancies; labor demand; employer search;

    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs

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