The one-day UNTANGLED workshop gathered 23 labour market economists from European universities and research institutes to discuss and reflect on 10 papers on skill changes and the value of skills.
The event, organised on 15 June in Warsaw by UNTANGLED partner the Institute for Structural Research (IBS), consisted of four sessions devoted to: the impact of technology on skills; worker flows; skills; and inequality. During the breaks, participants engaged in a discussion with the authors of four posters: Honorata Bogusz (UW), Agnieszka Kasperska (UW), Zuzanna Kowalik, and Karol Madoń (IBS).
The day focused on technological progress and skills and started with a presentation by Terry Gregory(LISER), on “Task Shifts in the Fourth Industrial Revolution – Firm-Level Evidence” (paper with Melanie Arntz, Sabrina Genz, Florian Lehmer, and Ulrich Zierahn-Weilage). The authors show that the decline of routine tasks in Germany is not linked to technology adoption within firms. Instead, de-routinisation can be explained by the scale and composition effects of firms adopting cutting-edge technologies, such as artificial intelligence. Myrielle Gonschor (RWI) presented a paper written with Ronald Bachmann titled “Technological Progress, Occupational Structure, and Gender Gaps in the German Labour Market”. She showed that in recent decades, women have increasingly entered non-routine cognitive and interactive occupations at the higher end of the wage distribution. However, while the gender gap has narrowed at the median and lower percentiles of the wage distribution, it did not in the best-paying occupations. Anna Matysiak (Labfam, UW) also presented a paper focused on gender, “Digitalisation, Changing Demand for Skills and the Gender Inequality in Earnings”, written with Wojciech Hardy and Lucas van der Velde. The authors find that in European countries, women are overrepresented in occupations that require social outward tasks, but they benefit from a wage premium in occupations that involve social inward tasks. Femke Cnossen (University of Groningen) presented her paper “Learning the Right Skill: Vocational Curricula and Returns to Skill”, co-written with Matloob Piracha and Guy Tchuente. She assessed to what extent basic and cross-functional skills are incorporated in Dutch vocational curricula and whether these skills can account for the wage differences among graduates. The paper shows that social and resource management skills are positively associated with earnings, especially in environments that require coordination, such as management-oriented occupations, large firms, and high-skilled service sectors. Meanwhile, basic content and technical skills are relatively more important in low-skill services.
Several speakers discussed the impacts of the COVID-19 pandemic. Duncan Roth (IAB) presented the paper “The Pandemic Push: Digital Technologies and Workforce Adjustments”, co-authored with Christina Gathmann, Christian Kagerl, and Laura Pohlan. He argued that the pandemic triggered the diffusion of digital technologies in Germany. About two in every three firms invested in digital technologies to improve decentralised communication, management and coordination, as well as training. These investments shielded workers against the impact of the pandemic, as investing firms relied less on short-term work, and laid off fewer marginal workers. Male, younger and medium-skilled workers benefitted the most from the insurance effect of digital investments. Sarra Ben Yahmed (ZEW) talked about how the pandemic influenced occupational mobility in Germany (paper with Melanie Arntz, Eduard Brüll, and Michael Stops). The initial findings indicated that workers shifted towards occupations of lower working quality, i.e.,, to less satisfying, more stressful, and more physically demanding jobs with longer working hours.
Two papers focused on worker flows in the context of decarbonisation. Florian Lehmer (IAB) spoke on “Worker Flows in the Low Carbon Transition” (study with Ronald Bachmann, Markus Janser, and Christina Vonnahme). He showed that in Germany, the growth rate of green occupations surpasses that of brown occupations, and brown occupations experienced a decline during the Covid pandemic. However, direct transitions from brown to green occupations are relatively limited, and worker upskilling from brown jobs could pose a significant challenge. Ilse Tobback (HIVA) studied a similar topic in Belgium (paper with Mikkel Barslund). Their research shows that the share of employees in brown occupations is declining with some workers transferring to green occupations which offer earnings premiums.
Finally, two presentations discussed inequality. Cristiano Perugini (University of Perugia) presented a paper titled: “Which Employers Share Rents? A Firm-level Analysis for Japan” written with Kyoji Fukao, Kenta Ikeuchi, and Fabrizio Pompei. They demonstrated that rent-sharing in Japan is higher in companies with higher intensity of intangibles and digitalisation. However, it mainly benefits highly educated employees and hence contributes to wage polarisation. Piotr Lewandowski (IBS) talked about the impact of automation on household income inequality in Europe, a study conducted in the UNTANGLED project with Karina Doorley, Jan Gromadzki, Dora Tuda, and Philippe Van Kerm. They find that robotisation widens wage inequality, but has negligible impact on household disposable income inequality, as risk sharing in households and redistribution by tax-benefit systems cushion the negative effects of automation.
For an overview of the programme click here.