American Economic Review
ISSN 0002-8282 (Print) | ISSN 1944-7981 (Online)
Technological Change and the Consequences of Job Loss
American Economic Review
(pp. 279–316)
Abstract
We examine the role of technological change in explaining the large and persistent decline in earnings following job loss. Using detailed skill requirements from the near universe of online vacancies, we estimate technological change by occupation and find that technological change accounts for 45 percent of the decline in earnings after job loss. Technological change lowers earnings after job loss by requiring workers to have new skills to perform newly created jobs in their prior occupation. When workers lack the required skills, they move to occupations where their skills are still employable but are paid a lower wage.Citation
Braxton, J. Carter, and Bledi Taska. 2023. "Technological Change and the Consequences of Job Loss." American Economic Review 113 (2): 279–316. DOI: 10.1257/aer.20210182Additional Materials
JEL Classification
- J24 Human Capital; Skills; Occupational Choice; Labor Productivity
- J31 Wage Level and Structure; Wage Differentials
- J63 Labor Turnover; Vacancies; Layoffs
- O33 Technological Change: Choices and Consequences; Diffusion Processes