Work Organization and High-Paying Jobs

Dylan Nelson, Nathan Wilmers and Letian Zhang
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Dylan Nelson: Massachusetts Institute of Technology Sloan School of Management
Nathan Wilmers: Massachusetts Institute of Technology Sloan School of Management
Letian Zhang: Harvard Business School

No 24-397, Upjohn Working Papers from W.E. Upjohn Institute for Employment Research

Abstract: High-paying factory jobs in the 1940s were an engine of egalitarian economic growth for a generation. Are there alternate forms of work organization that deliver similar benefits for frontline workers? Work organization varies by type of complexity and degree of employer control. Technical and tacit knowledge tasks receive higher pay for signaling or developing human capital. Higher-autonomy tasks elicit efficiency wages. To test these ideas, we match administrative earnings to task descriptions from job postings. We then compare earnings for workers hired into the same occupation and firm, but under different task allocations. When jobs raise task complexity and autonomy, new hires’ starting earnings increase and grow faster. However, while half of the earnings boost from complex, technical tasks is due to shifting worker selection, worker selection changes less for tacit knowledge tasks and very little for adding high-autonomy tasks. We also study which employers provide these jobs: frontline tacit knowledge tasks are disproportionately in larger, profitable manufacturing and retail firms; technical tasks are in newer health and business services; and higher-autonomy jobs are in smaller and fast-growing firms. These results demonstrate how organization-level allocations of tasks can undergird high-paying jobs for frontline workers.

Keywords: Wage level and structure; wage differentials; human capital; skills; occupational choice; labor productivity; labor management (search for similar items in EconPapers)
JEL-codes: J24 J31 M54 (search for similar items in EconPapers)
Date: 2024-03
New Economics Papers: this item is included in nep-hrm, nep-knm, nep-lma and nep-tid
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