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Economic Turbulence and Middle-Income Jobs

Economic Turbulence and Middle-Income Jobs

(p.100) Chapter Seven Economic Turbulence and Middle-Income Jobs
Economic Turbulence
Clair Brown
University of Chicago Press

This chapter describes the effect of economic turbulence on the earnings distribution. Economic turbulence affects the quality and quantity of middle-income jobs. Jobs at the bottom end of the earnings distribution and in low-skilled industries are much less likely to be stable than jobs at the top end and in high-skilled industries. Software and semiconductor industries have the lowest retention rates for workers in the top income category. There is evidence which suggests that firms share their success with their workers; thus, the more productive entering firms share some of that higher productivity with their workers. The positive effects for high-income workers are outweighed by the negative effects for low-income workers. Worker entry and exit has had very little impact on changes in the earnings distributions. Firm entry and exit tended to reduce dramatically the percentage of low-income workers.

Keywords:   economic turbulence, earnings distribution, middle-income jobs, software industry, semiconductor industry, firms, high-income workers, low-income workers

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