Abstract
AbstractWe investigate how individual workers and local labour markets adjust over a long time period to a discrete and plausibly exogenous technological shock, namely the introduction of containerization in the UK port industry. This technology, which was introduced rapidly between the mid‐1960s and the late‐1970s, had dramatic consequences for specific occupations within the port industry. Using longitudinal micro‐census data, we follow dockworkers over a 40‐year period and examine the long‐run consequences of containerization for patterns of employment, migration and mortality. The results show that the job guarantees negotiated by the unions protected dockworkers' employment until the guarantees were removed in 1989. A matched comparison of workers in comparable unskilled occupations reveals that, even after job guarantees were removed, dockworkers did not fare worse than the comparison group in terms of their labour market outcomes. Our results suggest that job guarantees provided a safety net which reduced the cost to workers of sudden technological change.
Highlights
Technological change can have dramatic and long-lasting effects on the labour market
Containerisation provides us with an opportunity to examine the labour market consequences of a technological shock which, in the space of a few years, completely removed the demand for a particular occupation
We have shown that the districts containing ports experienced worse labour market outcomes which continued and have remained for over 30 years
Summary
Technological change can have dramatic and long-lasting effects on the labour market. We consider a group of workers who were exposed to a sudden, well-defined and arguably exogenous technological shock, namely the introduction of containerisation to UK ports We follow those workers over a long period of time (effectively their entire working lives) and examine their patterns of employment, unemployment and other labour market outcomes relative to a matched control group. He uses CPS data and constructs difference-in-difference estimates of earnings gaps between truckers, dockers and warehousers and various control groups based on workers in non-transport occupations based in port and non-port cities He finds that dockers’ pay advantage over non-transport workers increased during the period of containerisation and deregulation.
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