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Is ICT Still Polarising Labour Demand after the Crisis?

Author

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  • David Pichler
  • Robert Stehrer

    (The Vienna Institute for International Economic Studies, wiiw)

Abstract

The impact of ICT capital accumulation and digitisation on labour demand and wage structures has changed in recent years, according to some of the literature on the subject. We analyse the impact of ICT capital accumulation based on recent data differentiating between the period before and after the global financial crisis. Methodologically, we draw on Michaels, Natraj and van Reenen (2014) and are able to corroborate their findings for the period 1980-2004, whereas we find distinctly different patterns since 2011. Results suggest a negative relationship between changes in ICT intensity and the wage share for high-skilled workers, whereas medium-skilled workers were the main beneficiaries in sectors that experienced a more intensive digitisation process. These results are chiefly driven by the dynamics in the Central and Eastern European economies and the service industries. The effect of digitisation on low-skilled workers does not reveal any robust significant impact.

Suggested Citation

  • David Pichler & Robert Stehrer, 2021. "Is ICT Still Polarising Labour Demand after the Crisis?," wiiw Working Papers 207, The Vienna Institute for International Economic Studies, wiiw.
    • Handle: RePEc:wii:wpaper:207
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    File URL: https://wiiw.ac.at/is-ict-still-polarising-labour-demand-after-the-crisis-dlp-5886.pdf
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    References listed on IDEAS

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    1. Robert G. Valletta, 2018. "Recent Flattening in the Higher Education Wage Premium: Polarization, Skill Downgrading, or Both?," NBER Chapters, in: Education, Skills, and Technical Change: Implications for Future US GDP Growth, pages 313-342, National Bureau of Economic Research, Inc.
    2. Timmer,Marcel P. & Inklaar,Robert & O'Mahony,Mary & Ark,Bart van, 2013. "Economic Growth in Europe," Cambridge Books, Cambridge University Press, number 9781107412446, November.
    3. Hulten, Charles R. & Ramey, Valerie A. (ed.), 2018. "Education, Skills, and Technical Change," National Bureau of Economic Research Books, University of Chicago Press, number 9780226567808, June.
    4. Charles R. Hulten & Valerie A. Ramey, 2018. "Education, Skills, and Technical Change: Implications for Future US GDP Growth," NBER Books, National Bureau of Economic Research, Inc, number hult-12, February.
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    Cited by:

    1. Stehrer, Robert, 2024. "The impact of ICT and intangible capital accumulation on employment growth and labour income shares," Structural Change and Economic Dynamics, Elsevier, vol. 70(C), pages 211-220.
    2. Robert Stehrer, 2024. "Neue Technologien, Firmenperformance und Beschäftigung: Erste Analysen basierend auf österreichischen Firmendaten," wiiw Research Reports in German language 26, The Vienna Institute for International Economic Studies, wiiw.

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    More about this item

    Keywords

    ICT capital; skill polarisation; wage patterns;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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