The Polarization of Employment in German Local Labor Markets

Charlotte Senftleben-König () and Hanna Wielandt ()
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Charlotte Senftleben-König: Humboldt-Universitaet zu Berlin
Hanna Wielandt: Humboldt-Universitaet zu Berlin

No 2014007, BDPEMS Working Papers from Berlin School of Economics

Abstract: This paper analyzes the polarization of employment and wages in Germany between 1979 and 2006, focusing on the role of technological progress. We exploit spatial variation in the exposure to technological progress which arises due to initial regional specialization in routine task-intensive activities. We show that the occupational structure of labor markets that were particularly susceptible to computerization has polarized, as employment shifted from middle-skilled, routine clerical and production occupations to less-skilled non-routine manual and service occupations. We find this shift to be the main driver of employment polarization at the lower tail of the wage distribution. Occupational shifts are gender-specific, with gains in service employment being exclusively realized by female employees. We further show that technological change contributes to a dispersion of the wage structure, as employment gains in services are accompanied by significant wage losses. Creation Date: 2014-11-07

Keywords: Job Tasks; Polarization; Technological Change; Service Occupations; Regional Labor Markets (search for similar items in EconPapers)
JEL-codes: J24 J31 J62 O33 R23 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ltv and nep-ure
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