The Trend is the Cycle: Job Polarization and Jobless Recoveries by Nir Jaimovich and Henry E. Siu

Transcription

1 The Trend is the Cycle: Job Polarization and Jobless Recoveries by Nir Jaimovich and Henry E. Siu Robert Shimer October 18, 2012

2 Two Questions what are routine occupations? substitutability with computers substitutability with imports what is the link between trend and cycle? Discussion of Jaimovich-Siu -p. 2

3 What are Routine Occupations? Discussion of Jaimovich-Siu -p. 3

4 Measuring Routine Tasks (ALM 2003) Autor, Levy, and Murnane (QJE 2003) Dictionary of Occupation Titles: 12,000 occupations, 44 dimensions use 1977 and 1991 dictionaries classify into 450 three digit census occupation codes measure routine/nonroutine and cognitive/noncognitive tasks pick out particular dimensions for each combination compute percentile within distribution allow occupations to change from 1977 to 1991 show inter alia more computerization in more routine industries Discussion of Jaimovich-Siu -p. 4

5 Measuring Routine Tasks (ALM 2003) Autor, Levy, and Murnane (QJE 2003) Dictionary of Occupation Titles: 12,000 occupations, 44 dimensions use 1977 and 1991 dictionaries classify into 450 three digit census occupation codes measure routine/nonroutine and cognitive/noncognitive tasks pick out particular dimensions for each combination compute percentile within distribution allow occupations to change from 1977 to 1991 show inter alia more computerization in more routine industries JS: classify one digit occupations into four groups Discussion of Jaimovich-Siu -p. 4

6 Mean Task Utilization (10 point scale) JS NC NM RC RM non-routine interactive non-routine analytical ALM non-routine manual routine cognitive routine manual ALM task measures: non-routine interactive: direction, control, planning non-routine analytical: GED Math non-routine manual: eye-hand-foot coordination routine cognitive: sets limits, tolerances, or standards routine manual: finger dexterity Discussion of Jaimovich-Siu -p. 5

7 Employment Change: 2007:11 to 2011: %: Services +0.9%: Professional and Related +0.7%: Management, Business, and Financial Operations 6.1%: Sales and Related 7.1%: Transportation and Material Moving 8.9%: Installation, Maintenance, and Repair 11.2%: Office and Administrative Support 13.8%: Production 26.2%: Construction and Extraction Discussion of Jaimovich-Siu -p. 6

8 What is the Link Between Trend and Cycle? Discussion of Jaimovich-Siu -p. 7

9 Overview standard procedure: detrend the data implicit assumption: no link between trend and cycles Discussion of Jaimovich-Siu -p. 8

10 Detrended Employment year Discussion of Jaimovich-Siu -p. 9

11 Overview standard procedure: detrend the data implicit assumption: no link between trend and cycles this paper does not argue that cycles affect trends this paper does argue that trends affect cycles Discussion of Jaimovich-Siu -p. 10

12 Theory workers must decide when to leave a declining industry lower opportunity costs induces bunching of exits during recessions exiting workers may experience: long unemployment duration low subsequent wages (but human capital growth) implications: step-like decline in employment persistent high unemployment rates initial surge in separation rates persistent low job finding rates unclear predictions for average labor productivity Discussion of Jaimovich-Siu -p. 11

13 Can This Explain Jobless Recoveries? many of these workers are likely dropping out of the labor force Discussion of Jaimovich-Siu -p. 12

14 Can This Explain Jobless Recoveries? many of these workers are likely dropping out of the labor force offsetting decline in movement from non-routine to routine in reality, workers always move in both directions trend has little effect on move unemployment Discussion of Jaimovich-Siu -p. 12

15 Can This Explain Jobless Recoveries? many of these workers are likely dropping out of the labor force offsetting decline in movement from non-routine to routine in reality, workers always move in both directions trend has little effect on move unemployment no persistent employment declines after 1991 and 2001 recessions Discussion of Jaimovich-Siu -p. 12

16 Employment Levels 11.0 non-routine cognitive 10.5 routine cognitive routine manual 10.0 non-routine manual year Discussion of Jaimovich-Siu -p. 13

17 Can This Explain Jobless Recoveries? many of these workers are likely dropping out of the labor force offsetting decline in movement from non-routine to routine no persistent employment declines after 1991 and 2001 recessions everyone is having trouble finding a job Discussion of Jaimovich-Siu -p. 14

18 Monthly Job Finding Probability job losers year Discussion of Jaimovich-Siu -p. 15

19 Monthly Job Finding Probability 60 new entrants job losers year Discussion of Jaimovich-Siu -p. 15

20 Monthly Job Finding Probability 60 new entrants reentrants job losers year Discussion of Jaimovich-Siu -p. 15

21 Monthly Job Finding Probability new entrants reentrants job leavers job losers year Discussion of Jaimovich-Siu -p. 15

22 Monthly Job Finding Probability new entrants temp layoffs job leavers reentrants job losers year Discussion of Jaimovich-Siu -p. 15

23 Can This Explain Jobless Recoveries? many of these workers are likely dropping out of the labor force offsetting decline in movement from non-routine to routine no persistent employment declines after 1991 and 2001 recessions everyone is having trouble finding a job open questions can you ex ante identify workers who will be cyclically sensitive? is this connected to how routine their task is? has this sensitivity changed over time? Discussion of Jaimovich-Siu -p. 16

24 The Trend is the Cycle: Job Polarization and Jobless Recoveries by Nir Jaimovich and Henry E. Siu Robert Shimer October 18, 2012