Technology Boom, Labor Reallocation, and Human Capital Depreciation

Johan Hombert and Adrien Matray
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Johan Hombert: HEC Paris
Adrien Matray: Princeton University

Working Papers from Princeton University. Economics Department.

Abstract: During the late 1990s boom, one-third of skilled labor market entrants joined the Information and Communication Technology (ICT) sector. We use French linked employer-employee data to study their wage dynamics. Despite starting with 5% higher wages, these workers experience lower wage growth and end up with 6% lower wages fifteen years out, relative to similar workers who started in other sectors. The long-run wage discount is not explained by selection, job losses or persistently low demand for ICT services. It is concentrated in STEM occupations, consistent with obsolescence of technical skills accelerating during a technological boom.

Keywords: Labor; Employment; France (search for similar items in EconPapers)
JEL-codes: E24 J24 O33 (search for similar items in EconPapers)
Date: 2021-12
New Economics Papers: this item is included in nep-ban, nep-hrm, nep-ict, nep-knm and nep-mac
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Persistent link: https://EconPapers.repec.org/RePEc:pri:econom:2021-81

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