Skilled Tradable Services: The Transformation of U.S. High-Skill Labor Markets

Fabian Eckert, Sharat Ganapati and Conor Walsh

No 25, Opportunity and Inclusive Growth Institute Working Papers from Federal Reserve Bank of Minneapolis

Abstract: We study a group of service industries that are skill-intensive, widely traded, and have recently seen explosive wage growth. Between 1980 and 2015, these ?Skilled Tradable Services? accounted for a sharply increasing share of employment among the highest earning Americans. Unlike any other sector, their wage growth was strongly biased toward the densest local labor markets and the highest paying firms. These services alone explain 30% of the increase in inequality between the 50th and 90th percentiles of the wage distribution. We offer an explanation for these patterns that highlights the complementarity between the non-rivalry of knowledge and changes in communication costs.

Keywords: Wage inequality; Skill biased; Technological change; Urban growth; Trade and geography (search for similar items in EconPapers)
JEL-codes: J31 O33 R11 R12 (search for similar items in EconPapers)
Pages: 53 pages
Date: 2019-09-13
New Economics Papers: this item is included in nep-geo, nep-lma, nep-ore, nep-tid and nep-ure
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Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedmoi:0025

DOI: 10.21034/iwp.25

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