kitchen table math, the sequel: The deskilling of U.S. jobs

Sunday, July 26, 2015

The deskilling of U.S. jobs

No idea what to make of this.
The Great Reversal in the Demand for Skill and Cognitive Tasks
Paul Beaudry, David A. Green, Benjamin M. Sand

Many researchers have documented a strong, ongoing increase in the demand for skills in the decades leading up to 2000. In this paper, we document a decline in that demand in the years since 2000, even as the supply of high education workers continues to grow. We go on to show that, in response to this demand reversal, high-skilled workers have moved down the occupational ladder and have begun to perform jobs traditionally performed by lower-skilled workers. This de-skilling process, in turn, results in high-skilled workers pushing low-skilled workers even further down the occupational ladder and, to some degree, out of the labor force all together.


Anonymous said...

So there are more people today with degrees and diplomas. That really doesn't mean they are skilled or educated, since this increase has been politically manufactured.

Auntie Ann said...

Lots of skilled labor can actually be outsourced to anywhere in the world, or done by a computer.

Anonymous said...

"No idea what to make of this."

The paper is long, but it appears that the authors have
discovered off-shoring of white-collar jobs.

Figure 11, "Occupational Employment Rate and Supply Index: Management, Professional, Tech"
shows that there was a peak in Management, Professional and Tech jobs
in 2000 (and another one in 2008 at about the same level ... it would also be
useful if the authors had chosen to label the Y-axis in this chart).

2000 was the peak of the dot-com boom, so we'd expect a dropoff in
techies as lots of unsustainable companies went away. Then we also
experienced a shakeout in "technical" jobs as folks discovered that they
could not longer command $50/hour to $100/hour for writing HTML by

2000 also was probably about when offshoring of programming jobs took
off (this is about when my employer got serious about moving jobs to India).
The internet was getting enough bandwidth that this was feasible, and this
also allowed sending things like "discovery" legal work and radiology analysis
off-shore. Surprisingly, lots of these jobs moved to where labor was relatively

If I have time, I'll dig more deeply into the paper (which is pretty opaque ... I
can't tell without a detailed read what they mean by "skilled and cognitive"
tasks ... I don't know that they include skilled lathe operators, for example.
Do they include file clerks?). They may just be showing that the growth in
white collar jobs that require sitting at a desk has slowed or stopped since
2000. Or that lots of college graduates are working as baristas ...

-Mark Roulo

Anonymous said...

I have now dug through the paper. Not only have
they *NOT* discovered the off-shoring of white-collar
jobs, they miss it completely and suggest other causes
for a decline in demand for "cognitive skills".

The key bit of the paper is this:

"Figure 9a captures what we view as the main new
insight in our paper: the idea that the demand for
cognitive tasks shifted down after 2000 (the bust
period). In our model, this happens because of the
nature of adjustment of the organizational capital
stock but, as we discussed earlier, it could also happen
for other reasons such as the arrival of a new technology
that is biased against (most) cognitive tasks. What we want
to emphasize is less the reason for the reversal in our
model than the fact of a reversal itself and its implications
for the remainder of the labor market."

The most important part is this: "the idea that the demand for
cognitive tasks shifted down after 2000"

But we don't have any evidence that demand for cognitive
tasks shifted down after 2000. We do have *some* evidence
that US demand for cognitive tasks shifted down after 2000 ...
but this could be because there was less work to be done *or*
because the work was being done elsewhere (or other reasons).
The paper builds a model to explain why less work for "cognitive
tasks" needed to be done after 2000 ... but my guess is that the
missing work *was* done, just not in the US.

I'll also point out that I don't see any evidence for a lower demand
for "cognitive tasks" in the paper. Maybe this is in some of the cited
work? My guess, however, is that the decline in journalism jobs is
part of what they are discussing ... and the reason for this decline
according to their model is that newspapers now have enough journalism
IP and no longer need to accumulate it as fast as in the past. Not
because the price charged (and thus cost) of news has headed towards
zero because of the Internet.

I'm not impressed.

-Mark Roulo

Anonymous said...

The company that I work for has found that degrees and credentials are not very useful for signaling whether an applicant has any skills -- cognitive or otherwise. Thus, we've developed several exercises that test applicants' level of competence at the skills necessary to do the job. We have a few written questions that we use pre-phone interview ("A client sends you the following email. How do you respond?") and several work-related tasks that we use during our on-site interviews.

A lot of people are unemployed for a good reason.