Technology, offshoring and the task content of occupations in the United Kingdom

Published date01 June 2016
DOIhttp://doi.org/10.1111/j.1564-913X.2015.00051.x
Date01 June 2016
AuthorSemih AKÇOMAK,Suzanne KOK,Hugo ROJAS‐ROMAGOSA
International Labour Review, Vol. 155 (2016), No. 2
Copyright © The authors 2016
Journal compilation © International Labour Organization 2016
* Science and Technology Policy Research Center (TEKPOL) and Graduate School of
Social Sciences, Middle East Technical University, email: akcomak@metu.edu.tr. ** Ministry
of Finance, the Netherlands, email: s.j.kok@minn.nl. *** CPB Netherlands Bureau for Eco-
nomic Policy Analysis, email: h.rojas-romagosa@cpb.nl. The authors would like to thank the man-
aging editor of the International Labour Review and the anonymous referee for their helpful
comments. We also received very helpful comments from Steven Brakman, Harry Garretsen, José
Luis Groizard, Arjan Lejour, Roman Stöllinger, Bas ter Weel, and participants at the following
conferences: fth Research Conference of the Forschungsschwerpunkt Internationale Wirtschaft
(FIW) Research Centre and the FIW Seminar in International Economics, Vienna, 2012; sec-
ond international BIBB/IAB Workshop on Technology, Assets, Skills, Knowledge, Specialization
(TASKS 2), Bonn, 2012; Turkish Economic Association (TEA) International Conference on Eco-
nomics, Izmir, 201 2; TOBB-ETU seminar “Effects of technology and offshoring on changes in
employment and the task content of occupations”, Ankara, November 2012; XIV Conference
on International Economics, Palma, Majorca, 2013; and the Annual Congress of the European
Economic Association, Gothenburg, 2013.
Responsibility for opinions expressed in signed articles rests solely with their authors, and
publication does not constitute an endorsement by the ILO.
Technology, offshoring
and the task content of occupations
in the United Kingdom
Semih AKÇOMAK,* Suzanne KOK**
and Hugo ROJAS-ROMAGOSA***
Abstract. The authors analyse change in employment levels and in the task con-
tent of occupations, both within occupations (i.e. at the intensive margin) and be-
tween occupations (i.e. at the extensive margin) in the United Kingdom over the
period 1997–2 006 using data from the national Skills Survey, which has compar-
able within-occupation task data for three waves: 1997, 2001 and 20 06. They nd
that within-occupation task content changed signicantly, and that the magnitude
of change was similar to that found at the extensive margin. Their econometric re-
sults suggest that these intensive-margin shifts can be explained by technological
improvements but not by offshoring.
I
mprovements in information and communication technologies (ICT) since
the 1980s, and the spread of economic globalization, have strongly inu-
enced the way we work. ICT improvements – especially the computerization
of work – have greatly affected labour demand, owing to skill-biased techno-
logical change (SBTC) (Berman, Bound and Machin, 1998; Autor, Levy and
Murnane, 2003; Borghans and ter Weel, 2006; Acemoglu and Autor, 2010;
International Labour Review202
OECD, 2010a; Van Reenen, 2011), but have also been a driving force in the
globalization process. In particular, the offshoring of jobs from developed
countries to emerging economies has been an inuential economic force in
the last 20 years.1
The recent literature has analysed the labour market effects of ICT im-
provements, and to a lesser extent those of offshoring, using the task-based
framework pioneered by Autor, Levy and Murnane (2003) – hereinafter the
“ALM model” – in which the labour market is analysed using information on
tasks performed by individual workers in their jobs, covering the period 196 0–98.
In particular, the authors classify tasks into two broad groups: routine and non-
routine tasks. Observing that computer capital substitutes for workers in carrying
out routine tasks, and complements workers in carrying out certain non-routine
tasks, they explain how computerization depresses the demand for medium-skill
workers performing routine tasks, but increases the demand for high-skill and
low-skill workers performing non-routine tasks. This “routinization” hypothesis
has been used to explain the wage and job polarization of the labour market,
which has been extensively documented.2 A distinguishing feature of the au-
thors’ methodology is the analysis of change in task content within occupations
(i.e. change at the intensive margin) and, holding constant within-occupation
task content, change between occupations (i.e. change at the extensive margin).
The authors found that from the 1970s onwards, the task content of jobs in the
United States became gradually more non-routine, and less routine-intensive. In
other words, the routine to non-routine ratio declined over the years, as a result
of changes at both the intensive and extensive margins.3
Subsequent task-based studies in the empirical literature have used the Oc-
cupational Information Network (O*NET) database, which in 199 8 superseded
the Dictionary of Occupational Titles (DOT) used by Autor, Levy and Murnane
(2003). The O*NET database, however, does not provide for time variation; con-
sequently, within-occupation changes have been largely ignored in subsequent
papers, with the exception of Spitz-Oener (2006). Thus, studies using these data
are limited to analysing change at the extensive margin only, implicitly assum-
ing that within-occupation task content is xed (Autor, Katz and Kearney, 2006
and 2008; Firpo, Fortin and Lemieux, 2011; Goos, Manning and Salomons, 2011
1 Feenstra and Hanson (1996); Blinder (2006); Jensen and Kletzer (2010); Goos, Manning
and Salomons (2011 and 2014); Firpo, Fortin and Lemieux (2011); Baumgarten, Geishecker and
Görg (2013).
2 For example, in Autor, Katz and Kearney (2006 and 200 8); Spitz-Oener (2006); Goos and
Manning (2007); Michaels, Natraj and Van Reenen (2011); Goos, Manning and Salomons (2011
and 2014); Firpo, Fortin and Lemieux (2011); and Autor and Dorn (2013). Meanwhile, Bloom et
al. (2013) distinguish differentiated effects of ICT on medium- and low-level occupations, and also
show evidence of trade-induced technical change.
3 We use the term “job” here in many cases, but our analysis is based on the three-digit “oc-
cupations” listed in the Standard Occupational Classication 2000 (SOC2 000) groupings. Jobs
refer to a set of tasks or duties to be carried out and thus the denition (title) of a “job” is nar-
rower than that of an occupation. Jobs are classied into SOC groups according to “skill level” and
“skill specialization”. Noting these differences, in this article we use the terms “job” and “occupa-
tion” interchangeably.

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT