The Impact of Technological Progress on the Labor Market: Employment Polarization in Europe

Following findings of recent literature, we analyze which are the main effects of the routine-bias technical change on employment. The master thesis shows evidence of employment polarization pattern for 16 European countries for the period 1995-2012. Occupations with high and low levels of earnings grow, while those with middle income occupations decline. This process accelerates during the recession period for all the studied countries (but for Italy). In a second step, we run a multinomial model to calculate the probabilities of working in three exclusive occupational categories: emerging high qualified, declining and emerging low qualified occupations. Results are computed for three model countries: Spain, Germany and Finland. We find that those with high educational level face higher probabilities on being in high paid jobs, although this happens to a lesser extent in Spain for young workers. When having low levels of education, men have higher chances of working on declining occupations, and women in low paid jobs.