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Snakes or Ladders? Skill Upgrading and Occupational Mobility in the US and the UK during the 1990s

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  • Richard Upward
  • Peter Wright

Abstract

It is frequently argued that the process of skill upgrading has both worsened the employment prospects and decreased the relative wages of unskilled workers. However, workers are not immutably either low skill or high skill, and skill upgrading may offer the opportunity for workers to move up the ‘skill ladder’. In this paper we examine the balance of these two effects. We use comparable individual-level panel data from the US and the UK to relate the probability of individual occupational movement to the extent of skill upgrading at the industry level. We find that whilst skill upgrading does indeed have a positive impact on the probability of moving up the job ladder, this is insufficient to outweigh the increased probability of unemployment. We also find that workers moving down or off the ladder suffer large wage penalties.

Suggested Citation

  • Richard Upward & Peter Wright, 2007. "Snakes or Ladders? Skill Upgrading and Occupational Mobility in the US and the UK during the 1990s," Discussion Papers 07/38, University of Nottingham, GEP.
    • Handle: RePEc:not:notgep:07/38
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    1. Oded Galor & Nachum Sicherman, 1988. "A Theory of Career Mobility," Working Papers 1988-27, Brown University, Department of Economics.
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      • Galor, Oded & Sicherman, Nachum, 1988. "A Theory of Career Mobility," Working Papers 51, The University of Chicago Booth School of Business, George J. Stigler Center for the Study of the Economy and the State.
    5. Eli Berman & John Bound & Zvi Griliches, 1994. "Changes in the Demand for Skilled Labor within U. S. Manufacturing: Evidence from the Annual Survey of Manufactures," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 109(2), pages 367-397.
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    Cited by:

    1. Konstantinos Angelopoulos & Spyridon Lazarakis & James Malley, 2019. "The distributional effects of peer and aspirational pressure," Working Papers 2019_06, Business School - Economics, University of Glasgow.
    2. Rod Falvey & David Greenaway & Joana Silva, 2018. "International competition, returns to skill and labour market adjustment," The World Economy, Wiley Blackwell, vol. 41(4), pages 1000-1024, April.
    3. Robert J. R. Elliott & Joanne Lindley, 2006. "Skill Specificity And Labour Mobility: Occupational And Sectoral Dimensions," Manchester School, University of Manchester, vol. 74(3), pages 389-413, June.
    4. Konstantinos Angelopoulos & Spyridon Lazarakis & James Malley, 2019. "The distributional effects of peer and aspirational pressure," Working Papers 2019-06, Business School - Economics, University of Glasgow.

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