Manufacturing Work Beyond Manufacturing Industries: A Reassessment of Structural Change

Dominik Boddin and Thilo Kroeger

No 2144, Discussion Papers of DIW Berlin from DIW Berlin, German Institute for Economic Research

Abstract: This paper studies the labor market impact of structural change by distinguishing between industry- and occupation-based measures of manufacturing and service employment. Using German data from 1975–2019, we find that 67% of manufacturing jobs lost in manufacturing industries are offset by new manufacturing jobs in service industries. Linking these aggregate patterns to worker-level outcomes, we show that the severity of displacement costs depends on the occupation–sector characteristics of the next job. Workers who retain manufacturing occupations in the service sector experience employment trajectories comparable to those remaining in manufacturing, indicating that structural change is less disruptive than commonly perceived.

Keywords: Employment Structure; Structural Change; Displacements; Layoffs; Occupations; Manufacturing decline; Germany (search for similar items in EconPapers)
JEL-codes: E24 J21 J24 J31 J63 L23 (search for similar items in EconPapers)
Pages: 40 p.
Date: 2025
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