Automation and Job Polarization: On the Decline of Middling Occupations in Europe

Abstract

Using data from 10 Western European countries, I provide evidence that the fall in prices of information technologies (IT) is associated with a lower share of employment in middle‐wage occupations and a higher share of employment in high wage occupations in industries which depend more on IT relative to industries which depend less. Similar results hold within gender and age groups, with notable differences in these groups. For instance, the share of employment in high wage occupations among males has increased less than among females with the fall in IT prices.