Middle-skill Jobs Research Articles

Higher Education and Unemployment in Turkey: Regional Panel Analysis with Undergraduate, Master's, and PhD Perspectives

In the past two decades, Turkey has experienced a noteworthy increase in the establishment of universities and enrollment of students across various degree programs. However, this surge in higher education has been accompanied by a growing number of unemployed higher education graduates. To address this phenomenon, this research conducts a comprehensive analysis of the relationship between different levels of tertiary education, undergraduate, master's, and Ph.D. (Doctorate) and unemployment. The study utilizes TurkStat's regional database, covering data from 26 provinces in Turkey spanning the years 2008 to 2021. Prior to delving into coefficient analysis, the Dumitrescu and Hurlin (2012) panel causality test was applied to identify the direction of potential causality and to establish an accurate model. The findings suggest a potential causal relationship running from being a higher education graduate, at all levels (bachelor's, master's, and PhD ), to unemployment rate. Subsequently, to further scrutinize this relationship in light of causality findings, the Panel Augmented Mean Group estimator (AMG) was employed. The results indicate that a 1% increase in the total number of Bachelor's degree graduates is associated with a 1.16% increase in unemployment rate. Based on these findings, it can be argued that, instead of further investing in higher education, a policy approach targeting middle-skilled jobs through advanced investment in vocational high schools may be more cost-effective.

The Neglected Class in the Developed Countries - Inequality in Economic Globalization

In the modern world, economic globalization has a big influence on the environment, economy, and society at large. Although it has significantly increased global development and decreased worldwide inequality, it has also presented serious difficulties, mainly with regard to the uneven distribution of income and advantages among people in developed countries. This article investigates the extent to which economic globalization affects local stability and political shifts in the United States, focusing on the disappearance of middle-skill jobs, the rise of populism, and the fallen of the American dream. The study employs a comprehensive literature review of existing research, theoretical frameworks, and empirical studies to navigate the complexity of the topic. Economic globalization has exacerbated income inequality, particularly in the United States, leading to the disappearance of middle-skill jobs, industrial sector decline, job outsourcing, and wage disparities. The belief that economic globalization denies people economic opportunities and exacerbates inequality is a contributory factor to the rise of populism in the nation. While economic globalization has increased average incomes worldwide, it has also widened the gap between rich and poor within developed countries. Governments should focus on equitable distribution of benefits, invest in education and social reforms, and enhance communities' ability to adapt to globalization, ultimately striving for fair and stable societies that align with the goals of global prosperity.

Industry 4.0: New challenges for the labor market and working conditions as a result of emergence of robots and automation

Abstract Subject and purpose of work: The paper is discussing the challenges presented by Industry 4.0, specifically in relation to the potential loss of jobs due to automation. The article explores how middle-skilled jobs are more likely to be affected adversely by automation and how the integration of cutting-edge technologies such as automation, AI, and IoT is expected to bring about extensive automation and irreversible changes to employment opportunities. Materials and methods: As this paper is a review of previous research articles, the authors have collected several journal articles. Results: The authors highlight how Industry 4.0 is expected to change working conditions and the nature of work and raises concerns about job insecurity and the erosion of traditional employment relations. Conclusions: The paper suggests that to tackle these challenges, policymakers and employers must be aware of the potential impacts of automation and Industry 4.0 on different types of occupations and take steps to mitigate any negative effects, and invest in retraining programs, implement policies that support the fair distribution of the benefits of automation and promoting the skills needed for the future of work.

An Exploratory Study of Digital Inequities and Work in the Redevelopment of a Southeastern American City

Nearly 6 million workers support the multi-billion-dollar digital economy as one of the fastest-growing sectors in the U.S. labor market. Middle-skill jobs in the digital economy sector that pay higher wages and do not require a bachelor’s degree are underrepresented people of intersectional marginalized identities. This exploratory study builds upon previous research on digital inequities by examining the digital economy values, behavior, and interests of a small sample of residents in an area of Charlotte, North Carolina with known digital, social, and economic inequities. Analyses included descriptive and bivariate statistics. Given the exploratory nature of the study, no causal inferences are made, however, preliminary findings suggest a need for further research on digital skills training that addresses the intersectional barriers experienced in marginalized communities, and the need for place-based interventions that leverage localized policies in the areas of affordable housing, workforce development, and economic development. Implications and limitations are discussed.

Impact assessment of the EU import ban on Indonesian palm oil: Using environmental extended multi-scale MRIO

Under the Renewable Energy Directive (RED) II, the EU will phase out the use of palm oil for biodiesel feedstock. Environmental concerns are the main reasons for the EU to implement this initiative. This study analyzes the economic and environmental impact of EU import ban to Indonesia at provincial level, using 2 scenarios (a direct and direct-indirect import ban). The analysis is performed using a global-subnational Multi-Regional Input-Output (MRIO) with environmental extensions. This study shows that a direct (combined) import ban of palm oil by the EU will reduce Indonesia's GDP by −0.2 % (−0.26 %) and employment by −0.12 % (−0.54 %) from baseline. At provincial level, Riau, North Sumatra, Lampung, Central Kalimantan and South Kalimantan experience the highest impact on their domestic product (more than −0.5 %). Under a direct import ban, job losses mostly happen in outside Java (96.26 %) and in the oilseeds sector (75.21 %). Low and middle skilled jobs decline more than high skilled jobs and count for 95 % of the total loss. This study also shows that a direct (combined) import ban reduces national GHG emissions by −0.19 % (−0.24 %) and total land use by −0.48 % (−0.6 %). Potential carbon sequestration can be 34.55 (42.27) million tons C equivalent to 149.74 (182.67) million tons CO2e under assumption a full rewilding from the reduction of land use in oilseed. Our study shows that an EU import ban on Indonesian palm oil has relatively small economic and environmental impacts at national and provincial level. Yet, this policy can create potential carbon sequestration that can absorb CO2 by vegetation and soil.

How do Incumbents Respond to the Entry of AI? A Study in the Mutual Funds Industry

This paper studies how incumbent firms respond to the emergence of AI as a process technology that performs tasks that humans can perform. Humans use different human capital skills to perform multiple tasks. Recent research suggests that AI could replace human labour in middle skilled jobs while capital and labour will be used by firms to perform low and high skill jobs respectively (Acemoglu and restrepo 2019). Yet, there is less clarity on firm level response to AI when the same skill can be used to perform multiple tasks. Hence, we adopt a question driven approach to answer the following questions (1) how do incumbents respond to the entry of AI/automation from outside the industry? (2) how does incumbent response vary by nature of the task subject to AI/automation? (3) how does incumbent response vary by skill specialization? (4) what are the performance consequences of incumbent sensitivity to AI/automation? We use the mutual funds industry as the context for our empirical examination. Using the emergence of algorithmic trading as an exogenous source of entry of AI, we study how mutual funds change their portfolio allocation in response to competition from AI. Further, we study how the change in holdings vary based on the nature of information available to managers to make decisions. We then study how the response of funds vary by the skill of the manager in picking stocks. Finally, we explore the difference in performance of funds based on managers’ response to the entry of AI. We find that (1) on average, mutual funds responded to the entry of algorithmic traders by reducing their exposure to affected stock; (2) this average response, however, masks considerable heterogeneity at both the task and skill-levels with funds exposure reduction increasing with greater information availability and decreasing with greater information ambiguity; (3) examining heterogeneity by skill specialization we observe that funds relying on timing skills of managers have a stronger response in reducing their exposure to AT affected stocks; (4) examining performance effects, we note that funds that move away from AT affected stocks modestly outperform stocks that are less responsive to algorithmic trading.

Wishing for More: Technological Change, the Rise of Involuntary Part-Time Employment and the Role of Active Labour Market Policies

AbstractTechnological change has squeezed the demand for middle-skill jobs, which typically involve routine-intense tasks. This squeeze has coincided with an increase in the number of part-time working individuals who wish to work more hours. We argue that these two trends are linked. Due to the decline of middle-skill employment, medium-educated workers shift into low-skill employment, increasing the supply of labour for jobs in this segment of the labour market. This pushes those dependent on these jobs to accept part-time jobs, even if these involve fewer hours than they prefer. To empirically assess this claim, we analyse involuntary part-time employment across 16 European countries between 1999 and 2010. Our analysis confirms that a decline in middle-skill employment is associated with an increase in involuntary part-time employment at the bottom end of the labour market. This finding implies that the automation of routine-intense labour worsens employment possibilities in this segment of the labour market. However, we show that training and job creation schemes mitigate this effect. These programmes cushion competition either by providing medium-educated workers with the necessary skills to shift into high-skill jobs or by increasing employment possibilities. Thus, governments have the tools to support workers facing challenges in the knowledge economy.

Difficulties in finding middle-skilled jobs under increased automation

AbstractThis study investigates the labor market under increased automation of middle-skilled jobs wherein worker suitability for these jobs is considered. We examine two effects of increased automation on workers. The first effect is the possibility of replacement of middle-skilled workers by machines. The second effect is the diversity in job mismatch probabilities of workers. If machines perform a worker’s suitable jobs more (or less) than the worker’s unsuitable jobs, then the worker’s job mismatch probability rises (or declines). Because workers who have larger job mismatch probabilities remain job seekers, it is more difficult for a firm to find a suitable worker. Due to these two effects, underemployment rises.

Hollowing out of opportunity: Automation technology and intergenerational mobility in the United States

Recent automation technology has lead to job polarization in the U.S. labour market since 1980. Middle-skill jobs, which provide decent wages for relatively uneducated people, have been shrinking in terms of employment share, pushing those workers into low-wage service jobs. In this paper, by exploiting spatial variation in the exposure to technological substitution, I provide suggestive evidence that automation technology has contributed to the decline of upward mobility of children from poor and middle-class families. My analysis suggests that middle-skill jobs are an indispensable channel for disadvantaged children to move upward. In addition, this paper provides a plausible explanation for the puzzling observation that relative mobility has stayed constant in the U.S. during recent decades, despite the rapidly increasing income inequality.

Existence of asymmetry between wages and automatable jobs: a quantile regression approach

PurposeThis study aims to explore, in the context of Machinery and Equipment sector of Malaysia, the association between average wages and share of employment in automatable jobs, specifically whether the association between average wages and share of employment automatable jobs is asymmetric in nature.Design/methodology/approachThe responses obtained from the structured interview of 265 firms are used to build up the empirical models (conditional mean regression and quantile regression).FindingsThe conditional mean regression findings show that employment levels in some low-waged, middle-skilled jobs are negatively associated with average wages. Furthermore, the quantile regression results add that firms that possess higher levels of share of employment in automation jobs are found to have a stronger association to average wages than those possessing a lower share of employment in automation jobs.Practical implicationsFrom the theoretical perspective, the findings of this study add to the body of knowledge of the theory of minimum wages and the concept of job polarization. From a policy perspective, the findings of this study can serve as a critical input to standard setters and regulators in devising industrial and as education policies.Originality/valueBased on the assumption of a constant average policy effect on automatable jobs, conditional mean regression models have been commonly used in prior studies. This study makes the first attempt to employ the quantile regression method to provide a deeper understanding of the relationship between wages and employment in automatable jobs.

Career and Technical Education as a Conduit for Skilled Technical Careers: A Targeted Research Review and Framework for Future Research

Workforce development and career and technical education (CTE) have long provided reliable pathways to middle skill jobs and a gateway to the middle class. Given recent changes in middle skills jobs, the education landscape, and federal policy priorities, the role of CTE in the U.S. educational landscape is evolving more rapidly, encompassing a broader range of education, and practices are changing ahead of research. The first part of this report provides an overview of the current state of CTE in the United States, as well as the state of CTE research, and presents an argument for a broader definition of CTE that incorporates workforce development through postsecondary institutions. The second part provides operational definitions and typologies to facilitate future research. Our aim is to build a research framework for CTE that is grounded in a normative path through CTE: getting in (preparation and recruitment), getting through (retention and skill acquisition), getting out (completion and initial hire), and getting on (career progression). Key challenges and priorities for future research are discussed.

Difficulties in Finding Middle-Skilled Jobs under Increased Automation

Difficulties in Finding Middle-Skilled Jobs under Increased Automation

Job Polarisation in India: Structural Causes and Policy Implications

Automation impacts wage levels at the micro-level and the structure of employment at the macro-level. Job polarisation is defined as the automation of ‘middle-skilled’ jobs that require routine cognitive and manual applications, whilst high- and low-skilled occupations are preserved. This paper examines the nature of job polarisation in India during the period 1983–2012 when Indian manufacturing sector was being automated. The research uses disaggregated data from National Sample Survey Office and examines the impact of supply-side factors such as nature of employment and presence of educated labour force. The study has three observations. First, the increased demand for high-skilled workers in the formal manufacturing sector is due to skill bias of technology and conforms to theoretical expectation. Second, the transition of agricultural labourers to low-skilled manufacturing sectors such as construction and textiles signals distress in traditional manufacturing sector to provide employment to these groups. Third, the over-supply of secondary and tertiary educated labour force has resulted in the squeezing out of middle-skilled workers from middle-skilled jobs to relatively low-skilled manufacturing and service occupations. This explains the persistence of routine occupations even after automation. The study concludes that in the Indian manufacturing sector, increased demand for high- and low-skilled jobs has coexisted with the middle-skilled jobs due to supply-side factors.

Job Polarisation in India: Structural Causes and Policy Implications

Automation impacts wage levels at the micro-level and the structure of employment at the macro-level. Job polarisation is defined as the automation of ‘middle-skilled’ jobs that require routine cognitive and manual applications, whilst high- and low-skilled occupations are preserved. This paper examines the nature of job polarisation in India during the period 1983–2012 when Indian manufacturing sector was being automated. The research uses disaggregated data from National Sample Survey Office and examines the impact of supply-side factors such as nature of employment and presence of educated labour force. The study has three observations. First, the increased demand for high-skilled workers in the formal manufacturing sector is due to skill bias of technology and conforms to theoretical expectation. Second, the transition of agricultural labourers to low-skilled manufacturing sectors such as construction and textiles signals distress in traditional manufacturing sector to provide employment to these groups. Third, the over-supply of secondary and tertiary educated labour force has resulted in the squeezing out of middle-skilled workers from middle-skilled jobs to relatively low-skilled manufacturing and service occupations. This explains the persistence of routine occupations even after automation. The study concludes that in the Indian manufacturing sector, increased demand for high- and low-skilled jobs has coexisted with the middle-skilled jobs due to supply-side factors.

Automation and the Future of Young Workers: Evidence from Telephone Operation in the Early 20th Century

Telephone operation, one of the most common jobs for young American women in the early 1900s, provided hundreds of thousands of female workers a pathway into the labor force. Between 1920 and 1940, AT&T adopted mechanical switching technology in more than half of the U.S. telephone network, replacing manual operation. Although automation eliminated most of these jobs, it did not affect future cohorts’ overall employment: the decline in demand for operators was counteracted by growth in both middle-skill jobs like secretarial work and lower-wage service jobs, which absorbed future generations. Using a new genealogy-based census linking method, we show that incumbent telephone operators were most impacted by automation, and a decade later were more likely to be in lower-paying occupations or have left the labor force entirely.

Work of the Past, Work of the Future

US cities today are vastly more educated and skill-intensive than they were five decades ago. Yet, urban non-college workers perform substantially less skilled jobs than decades earlier. This deskilling reflects the joint effects of automation and, secondarily, rising international trade, which have eliminated the bulk of non-college production, administrative support, and clerical jobs, yielding a disproportionate polarization of urban labor markets. The unwinding of the urban non-college occupational skill gradient has, I argue, abetted a secular fall in real non-college wages by: (1) shunting non-college workers out of specialized middle-skill occupations into low-wage occupations that require only generic skills; (2) diminishing the set of non-college workers that hold middle-skill jobs in high-wage cities; and (3) attenuating, to a startling degree, the steep urban wage premium for non-college workers that prevailed in earlier decades. Changes in the nature of work--many of which are technological in origin--have been more disruptive and less beneficial for non-college than college workers.

Labor market polarization, the decline of routine work, and technological change: A quantitative analysis

A common hypothesis for labor market polarization is that technological progress has decreased the price of machines which are substitutable with middle skilled jobs and complementary to higher and lower skilled jobs. I quantitatively evaluate this hypothesis in a dynamic general equilibrium model. I find that the near constant elasticities of labor demand in the standard technology hypothesis and the observed dynamics of the price of machines are inconsistent with rapid polarization pre-2000 and its slower dynamics thereafter. Extending the model to allow for a separate investment sector requiring only high skilled workers generates a much closer fit to data.

The decline in middle-skilled employment in 12 European countries: New evidence for job polarisation

Is the middle class shrinking? This article contributes to the debate on job polarisation in Europe. Based on data from the European Union Labour Force Survey (EU-LFS) and looking at 12 European countries, it shows that there is an evident trend towards job polarisation. While this polarisation takes various forms, it is clearly the highest- and lowest-skilled jobs that have increased most rapidly among the active population over the past 20 years, to the detriment of middle-skilled jobs. The article then goes on to demonstrate that polarisation also exists when it comes to working conditions insofar as the lowest-skilled jobs are also where the most precarious employment conditions are found. Conversely, the remaining middle-skilled jobs are relatively shielded from this decline in working conditions.

Embracing the sobering reality of technological influences on jobs, employment and human resource development

PurposeThis paper aims to provide a sobering and unique view of technological unemployment and job changes by identifying endangered jobs and skills, as well as the essential up-skills critical to employees’ performance, which cannot be replaced by technology.Design/methodology/approachA systematic literature review, used because it is replicable, transparent, and scientific, was implemented to examine the current and future technological influences on employment, job outlook, work structure, and human resource development (HRD).FindingsThe study concludes that HRD professionals should promptly reexamine their social responsibility relative to the technological influence on workers by focusing developmental efforts on employees’ human skills while assisting workers’ transition to a skill-polarized workplace. HRD professionals should play a major role in facilitating employees’ coexistence with robots in the workplace.Originality/valueWhile recognizing the valuable contributions of previous researchers with similar concerns, this comprehensive review provides an amalgamated and updated view, which reveals the escalating and combined challenges of a skill-polarized workplace, a tendency of technological unemployment for those positioned in middle-skill jobs, and an increased demand for employees with a higher level of human skills.

Inward Greenfield FDI and Patterns of Job Polarization

The unprecedented growth in foreign direct investment in the last few decades has caused drastic changes in the labor markets of the host countries. The major part of FDI takes place in low-tech industries, where the wages and skills are low, or in high-tech, where they offer a wage premium for the highly skilled workers. This mechanism may increase the polarization of employment into high-wage and low-wage jobs, at the expense of middle-skill jobs. This paper looks at the effects of two types of FDI inflows, namely foreign investment in high-skill and low-skill activities, on job polarization. We match data on greenfield FDI aggregated by country and sector with data on employment by occupational skill to investigate the extent to which different types of greenfield FDI are responsible for skill polarization. Our results show that low-skill foreign investment shifts employment from high- to medium- and low-skill jobs, while skill-intensive FDI generally leads to skill upgrading. Only FDI in information and communication technology (ICT) is associated with job polarization, but only when accounting for the plurality of job polarization patterns across European sectors.