Valeria Cirillo

Technology, employment and skills†

ABSTRACT This article investigates the relationships between technological change and employment considering the dynamics of four major professional groups - Managers, Clerks, Craft and Manual workers – defined on the basis of ISCO classes. The aim is to move beyond skill-biased and task-based views of the impact of technical change on skills and to identify the structural determinants of employment changes. A model is developed explaining changes in jobs as a result of changes in demand – total, domestic and foreign –, wages, the importance of innovation in products and processes and the role of the international fragmentation of production. The empirical analysis is carried out on manufacturing and service industries of major European countries over the 2000–2014 period. Results show that moving from aggregate employment to the dynamics of professional groups major diversities emerge; managers – for instance – are the main beneficiaries from product innovations, while clerks, craft and manual workers are negatively affected by the introduction of new processes. Separate estimations are also carried out for high and low tech industries and for Northern and Southern European countries, identifying a variety of ways in which patterns of innovation and structural change affect jobs in specific professional groups.

The dynamics of profits and wages: technology, offshoring and demand

ABSTRACT This article explores the impact of innovation, offshoring and demand on profits and wage dynamics. Empirical analysis is performed on a panel of 37 industries (1995–2010) across five European countries. Our identification strategy relies on instrumental variables and recently proposed heteroskedasticity-based instruments. Additionally, we perform sensitivity analysis to account for omitted variables bias. The main results of our study can be summed up in three points. First, it highlights the contrasting effects of R&D and offshoring as wage determinants. Second, it shows that external demand is a key variable driving profits growth. Third, the categorisation of workers according to skill level shows that high-skilled workers are favoured by both innovation and offshoring, offshoring exerts downward pressure primarily on low-skilled wages and profits are positively correlated with high-skill wages, negatively correlated with medium-skill wages and not correlated with low-skill wages.

La crisi e le riforme del mercato del lavoro in Italia: un’analisi regionale del Jobs Act

This paper provides an analysis of the dynamics of the Italian labor market after the introduction of the Jobs Act analyzing, in particular, the regional dimension. In line with the evidence shown in Fana et al. (2016), we show that, after the Jobs Act, temporary employment increased more than permanent one. Moreover, it emerges as the slight increase in employment is significantly linked to the stabilization of existing contracts rather than the creation of new employment. The dynamics of employment at the regional level is characterized by a significant degree of heterogeneity. However, no specific regional patterns seems to emerge. The empirical analysis is based on data on the labor force (ISTAT) distinguished by regions and on administrative data (INPS) concerning the quantity, quality and duration of employment contracts.

Where Does the Surplus Go?Disentangling the Capital-Labor Distributive Conflict

The evidence on growing inequality in OECD countries has raised an important debate over its main drivers, pointing out an increasing importance of capital-labour conflict. In this contribution, we aim at disentangling the role of some of the forces shaping this process. Our identification strategy relies on the sequential nature of wage setting and profits realization, in line with theoretical insights from the range theory of wages (postulating rents sharing at the shop floor level) and the principle of effective demand. In particular we focus on the role of technology and offshoring as instruments to create surplus and to shape the bargaining power of the parties involved in wage setting, and on different sources of demand as heterogeneous determinants of profits realization. The empirical analysis is performed on a panel of 38 manufacturing and service sectors over four time periods from 1995 to 2010, covering Germany, France, Italy, Spain, and United Kingdom. The contrasting effects of R&D and offshoring emerge as determinants of wages. Investment and internal demands are key variables in the realization of profits. When we look at the heterogeneity of the effects we see three main stylized facts. First of all, distinguishing for technological domain using Pavitt classes we can see that rents are effectively related with upgraded industries. Secondly, when we distinguish for the degree of openness we can see that, again, rents are mainly shared in open industries. Finally, when we disentangle the effect on wages per skill level, it is possible to confirm the intuition that offshoring hits the medium-low skill categories.