This Job is “Getting Old”: Measuring Changes in Job Opportunities using Occupational Age Structure

Abstract

One of the most remarkable developments in the US labor market of the past two and a half decades has been the rapid, simultaneous growth of employment in both the highest- and lowest-skilled jobs. This phenomenon is depicted in Figure 1, which plots changes in the share of aggregate hours worked at each percentile of the occupational skill distribution over the period 1980 through 2005. These skill percentiles are constructed by ranking occupations according to their mean hourly wages in 1980 and grouping them into 100 bins, each comprising 1 percent of 1980 employment.1 The pronounced U-shape of Figure 1 underscores that employment growth over this 25-year period has been disproportionate in the top and bottom of the occupational skill distribution. Occupations that were in the lowest and highest deciles of the 1980 distribution grew in relative size by 10 to 25 percent between 1980 and 2005, while occupations in the second through sixth deciles contracted. 2 This hollowing out, or “polarization,” of the occupational employment distribution is not unique to the United States. Using harmonized European Union Labour Force Survey data, Maarten Goos, Alan Manning, and Anna Salomons (2008) find that in 14 of 16 European countries for which data are available, high-paying occupations expanded relative to middle-wage occupations in the 1990s and 2000s, and in all 16 countries, low-paying occupations expanded relative to middle-wage occupations.