David Autor on the Job Market(s)
By Arnold Kling
I felt a little guilty about my Job-seeker’s Paradox post, knowing that I was channeling David Autor. So let me relieve my conscience by quoting at length from a paper that Autor wrote in April of 2010.
Routine tasks as described by economists David Autor, Frank Levy, and Richard Murnane are job activities that are sufficiently well defined that they can be carried out successfully by either a computer executing a program or, alternatively, by a comparatively less-educated worker in a developing country who carries out the task with minimal discretion
More excerpts below the fold. Some of his findings are very important, so please read on.
During the 1980s (1979 to 1989), employment growth by occupation was almost uniformly rising in occupational skill; occupations below the median skill level declined as a share of employment, while occupations above the median increased. In the subsequent decade, this uniformly rising pattern gave way to a distinct pattern of polarization. Relative employment growth was most rapid at high percentiles, but it was also modestly positive at low percentiles (10th percentile and down) and modestly negative at intermediate percentiles.
Fast forward to the period 1999 to 2007. In this interval, the growth of low-skill jobs comes to dominate
Incidentally, these relative trends have continued.
The polarization of employment across occupations is not unique to the United States, but rather is widespread across industrialized economies. Evidence of this fact is presented below through a comparison of the change in the share of employment between 1993 and 2006 in 16 European Union economies…Notably, in all 16 countries, low-wage occupations increased in size relative to middle-wage occupations.
Over the past three decades,
male employment-to-population rates declined modestly for all education levels and among all race groups. But these declines are most pronounced for less-educated males–those with high school or lower levels of education–and particularly for less-educated minority males. In contrast, the employment-to-population rates of females rose among all but the least-educated group over this same period
My intuition and Autor’s econometric analysis both suggest that the decline in male labor-force participation at low levels of education is largely in response to lower relative wages. Another gender-related fact:
College completion among young adult females slowed in the 1980s, but then rebounded in the subsequent two decades. For males, however, college attainment among young adults fell sharply after the end of the Vietnam War in 1974, and has taken nearly three decades to return to its mid-1970s high water mark. Looking forward, it is clear that females will be the more educated sex for many years to come
This strikes me as a big deal:
a sizable share of the increase in wages for college-educated workers relative to noncollege-educated workers since 1980 is explained by rising wages for workers with postbaccalaureate degrees. … real wages for males with exactly a four-year degree rose by only 10 percent between 1979 and 2007. This is an anemic performance compared to those males with postbaccalaureate degrees, who experienced real wage gains of 26 percent over the same period.
And so does this:
while the earnings gaps among workers with some college education, workers with a high school degree, and workers who dropped out of high school expanded sharply in the 1980s, these gaps stabilized thereafter. Increasingly, the wages of high school dropouts, high school graduates, and those with some college education moved in parallel–as if they were three “sizes” of the same underlying bundle of skill.