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Changes in the Demand for Skilled Labor within U. S. Manufacturing: Evidence from the Annual Survey of Manufactures
Abstract
This paper investigates the shift in demand away from unskilled and toward skilled labor in U. S. manufacturing over the 1980s. Production labor-saving technological change is the chief explanation for this shift. That conclusion is based on three facts: (1) the shift is due mostly to increased use of skilled workers within the 450 industries in U. S. manufacturing rather than to a reallocation of employment between industries, as would be implied by a shift in product demand due to trade or to a defense buildup; (2) trade- and defense-demand are associated with only small employment reallocation effects; (3) increased use of nonproduction workers is strongly correlated with investment in computers and in R&D.
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“Therefore, the income distribution becomes dependent on the changes in the skill composition of workers and skill-biased nature of technological progress (see, for instance, Berman et al., 1994;Autor et al., 1998;Piva and Vivarelli, 2004;Acemoglu and Autor, 2011).”
From Financialization and the Labor Share of Income (2019) · cites this paper as Berman et al., 1994
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“See Robbins (1996), Hanson and Harrison (1999), Berman and Machin (2000) and the evidence reported in Section 4. Davis (1996) warns that these findings do not contradict the Hecksher-Ohlin model as countries that are labour abundant in a global sense might be skill abundant relative to trading partners. Wood (1997) pr…”
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“7 A related finding is that much of the changes in skill-upgrading is “within” industry rather than “between”, see e.g. Berman et al (1994).”
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“Berman et al. (1998) and Berman and Machin (2000) nd that this nding generalizes to a large number of countries since the 1970s, and conclude that there has been pervasive skill-biased technological change also on a global scale.”
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“The Canadian trend is consistent with events in the U.S. manufacturing sector [see Berman, Bound, and Griliches (1994)], though the magnitude of the increase is somewhat less in Canada.8 7 A time trend regression of the form Ln (Share) = a + bT, where T is time, was run for the periods 1973- 1992,…”
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“Ž .computers are complements substitutes in production to non-manual manual workers, as found also Ž .recently in another study for the US Berman et al., 1994 .”
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“The dependent variable, i.e., the skill ratio, is calculated, in line with recent literature (Berman, Bound, and Griliches 1994), as the ratio between non-production workers and production workers.”
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“While authors like Berman, Bound, and Griliches (1994), Fitz Roy and Funke (1995), Machin, Ryan, and Van Reenen (1998), Krusell et al. (2000) or Moreno-Galbis (2002) claim that the capital-skill complementarity relationship is at the origin of the observed skill-biased technological change, other…”
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“2) JsjxwS ikjk J s K k ijjsjij ,.,,..,1,lnln 1 1 Most studies using this approach have estimated this set of equations by pooling data across industries thereby assuming that the same cost function applies across industries (e.g. Berman et al., 1994; Feentra and Hanson, 1996).”
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Metadata
- Authors
- Berman, E., Bound, J., & Griliches, Z.
- Affiliations
- Boston University (US)
- National Bureau of Economic Research (US)
- ORCID
- Venue
- The Quarterly Journal of Economics
- Publisher
- Oxford University Press (OUP)
- Published
- 1994-05-01
- Volume
- 109
- Issue
- 2
- Pages
- 367-397
- ISSN
- 0033-5533 (ISSN-L)
- 1531-4650
- OpenAlex
- W2078001550
- Cited by
- 1,870
- References
- 28
- Citations by year
- 2026: 22 · 2025: 23 · 2024: 25 · 2023: 33 · 2022: 41 · 2021: 45 · 2020: 46 · 2019: 50 · 2018: 38 · 2017: 63 · 2016: 43 · 2015: 73 · 2014: 63 · 2013: 75 · 2012: 55
- FWCI
- 93.64
- Type
- journal article
- Language
- en
- Open access
- closed
- Locations
- The Quarterly Journal of Economics (publishedVersion)
- RePEc: Research Papers in Economics (submittedVersion)
- Funders
- National Science Foundation
- Topics
- Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Labor market dynamics and wage inequality
- Social Sciences › Economics, Econometrics and Finance › General Economics, Econometrics and Finance › Global trade and economics
- Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Economic Growth and Productivity
- Keywords
- skilled labor demand, manufacturing employment, labor reallocation, defense spending, IT investment, R&D investment
About these checks
Registry, retraction, Cites and statistics results are computed, not judged, with one exception: a printed reference that no index lists is read once by a model before it counts as a citation error. Claims are extracted by a model and kept only when their quote appears verbatim in the text; each cited source is then checked, with a model’s help, for whether it says what the claim relies on. Those verdicts can be wrong — read the claim’s quote and the cited source before relying on one.
Statistics and arithmetic are recomputed, not judged.
Confidence bands are shown only for fields calibrated on our annotated test set. None is calibrated yet, so no band is shown.
What counts as a claim ›How we measure confidence ›How we check this ›
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