Job Polarization

 

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Job polarization became a prevalent issue in the U.S. during the Great Recession of 2008.  It refers to expansions in high-skill, high-wage and low-skill low wage job opportunities, but diminished middle-class job opportunities.  According to MIT’s Department of Economics and National Bureau of Economic Research, this decline has disproportionately affected men without four-year college degrees because they are often forced to remain in labor-intensive jobs (2).  One of the most prominent effects of job polarization is the wage gap between college-educated and non-college-educated workers (Autor 6).  Those with college degrees are more likely to seek high-wage occupations and achieve social mobility, while those who do not have college degrees are often stuck in dead-end, low-wage jobs.  Although this article states that wages increased for both high-wage and low-wage jobs at a higher rate than middle-wage jobs, this is actually detrimental to lower-wage employees.  First, it decreases their chances of achieving social mobility; with fewer jobs in the middle sector and the attraction of a slightly higher salary in a job that provides minimal opportunities for growth, these workers may be tempted to stay in low-wage jobs.  This issue is common in countries with industrialized economies, as evidenced by a study involving 16 EU economies.

 

Autor states that the four primary reasons why job polarization occurs are changes in technology, international trade, decreases in labor union infiltration in the private sector, and decreases in the value of the minimum wage (8).

 

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Glossary, UD: Economic Inequality

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