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Long-Run Patterns of Labour Market Polarisation: Evidence from German Micro Data

Author

Listed:
  • Bachmann, Ronald

    () (RWI)

  • Cim, Merve

    () (RWI)

  • Green, Colin

    () (Norwegian University of Science and Technology (NTNU))

Abstract

The past four decades have witnessed dramatic changes in the structure of employment. In particular, the rapid increase in computational power has led to large-scale reductions in employment in jobs that can be described as intensive in routine tasks. These jobs have been shown to be concentrated in middle skill occupations. A large literature on labour market polarisation characterises and measures these processes at an aggregate level. However to date there is little information regarding the individual worker adjustment processes related to routine-biased technological change. Using an administrative panel data set for Germany, we follow workers over an extended period of time and provide evidence of both the short-term adjustment process and medium-run effects of routine task intensive job loss at an individual level. We initially demonstrate a marked, and steady, shift in employment away from routine, middle-skill, occupations. In subsequent analysis, we demonstrate how exposure to jobs with higher routine task content is associated with a reduced likelihood of being in employment in both the short term (after one year) and medium term (five years). This employment penalty to routineness of work has increased over the past four decades. More generally, we demonstrate that routine task work is associated with reduced job stability and more likelihood of experiencing periods of unemployment. However, these negative effects of routine work appear to be concentrated in increased employment to employment, and employment to unemployment transitions rather than longer periods of unemployment.

Suggested Citation

  • Bachmann, Ronald & Cim, Merve & Green, Colin, 2018. "Long-Run Patterns of Labour Market Polarisation: Evidence from German Micro Data," IZA Discussion Papers 11570, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp11570
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    References listed on IDEAS

    as
    1. Nir Jaimovich & Henry E. Siu, 2012. "The Trend is the Cycle: Job Polarization and Jobless Recoveries," NBER Working Papers 18334, National Bureau of Economic Research, Inc.
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    5. 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.
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    11. Daniel Baumgarten, 2015. "Offshoring, the Nature of Tasks, and Occupational Stability: Empirical Evidence for Germany," The World Economy, Wiley Blackwell, vol. 38(3), pages 479-508, March.
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    More about this item

    Keywords

    polarization; occupational mobility; worker flows; tasks;

    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
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity

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