Individual Consequences of Occupational Decline

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IZA Seminar

Place: Schaumburg-Lippe-Str. 9, 53113 Bonn

Date: 21.04.2020, 12:15 - 13:30


Presentation by 

Guy Michaels (London School of Economics)




What are the earnings and employment losses that workers suffer when demand for their
occupations declines? To answer this question we combine forecasts on occupational employment
changes, which allow us to identify unanticipated declines; administrative data
on the population of Swedish workers, spanning several decades; and a highly detailed
occupational classification. We find that, compared to similar workers, those facing occupational
decline lost about 2-5 percent of mean cumulative earnings from 1986-2013. But
workers at the bottom of their occupations’ initial earnings distributions suffered considerably
larger losses. These earnings losses are partly accounted for by reduced employment,
and increased unemployment and retraining.

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