Service Imports, Workforce Composition, and Firm Performance: Evidence from Finnish Microdata

Andrea Ariu, Katariina Nilsson Hakkala, J. Jensen () and Saara Tamminen

No 70, ETLA Working Papers from The Research Institute of the Finnish Economy

Abstract: Abstract This paper uses unique Finnish firm-level micro data on service imports, workforce composition, and firm characteristics to examine changes in employment composition and performance of Finnish service importers during a period of a significant increase in services imports (2002–2012). We use world service export supply shocks, which we allocate to firms based on their highly specialized service input structure, as an instrument to identify the impact of service offshoring. We find that firms that increase imports of service inputs reduce employment of low-skill service workers, increase employment of (high-skilled) managers, and improve their performance in terms of sales (turnover), assets, service exports, and firm survival. The employment composition and performance responses to service imports differ across firms in the manufacturing sector and those in the service sector.

Keywords: Service offshoring; Employment; Firm performance (search for similar items in EconPapers)
JEL-codes: F10 F14 L80 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2019-10-30
New Economics Papers: this item is included in nep-bec, nep-eur and nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

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Related works:
Working Paper: Service Imports, Workforce Composition, and Firm Performance: Evidence from Finnish Microdata (2019)
Working Paper: Service Imports, Workforce Composition, and Firm Performance: Evidence from Finnish Microdata (2019)
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