Paula Prenzel (p), Simona Iammarino

Duncan Roth

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Nikolaos Terzidis (p), Steven Brakman, Raquel Ortega - Argiles

Paula Prenzel

Recent literature documents the pervasiveness of job polarization in the labor markets of the developed world. We utilize extensive data from Netherlands Statistics (CBS) to present an empirical analysis of employment changes in the Dutch local labor markets from 1999 to 2012. We verify polarization as the main trend in the national labor market and identify the routinization hypothesis as its main source. Our analysis also indicates considerable spatial heterogeneity among local labor markets. However, utilizing segmented regression analysis we identify the regional labor markets consistently exhibiting job polarization dynamics as well as their main characteristics (urbanization, industry composition favoring the service sector, skilled labor force participation etc.). Therefore, our analysis provides conclusive evidence on the regional pervasiveness of polarization in the Netherlands.

Duncan Roth (p), Uwe Blien, Wolfgang Dauth

Nikolaos Terzidis

In many industrialized countries, employment has grown predominately in jobs at the upper and lower tail of the wage distribution, while employment in the middle of the distribution has stagnated or declined. One explanation for this polarised development is that jobs in the middle of the wage distribution, which involve a substantial amount of routine tasks, are substituted by machines. Descriptive analyses at the national level suggest that in West Germany this phenomenon occurred only during recent years. A similar pattern emerges when occupation-specific employment growth rates at the regional level are regressed on indicators for an occupation’s position in the income distribution. However, once a measure of routine intensity within an occupation is added to the model the effect of these indicators considerably decreases in magnitude. In contrast, the measure of routine intensity has a negative and significant effect, which provides some evidence for the existence of routine-biased technological change within regional labour markets.