Digital Labor Market Inequality and the Decline of IT Exceptionalism

70 Pages Posted: 27 Aug 2020 Last revised: 11 Jun 2021

See all articles by Sam (Ruiqing) Cao

Sam (Ruiqing) Cao

Stockholm School of Economics

Shane M. Greenstein

National Bureau of Economic Research (NBER); Harvard University - Technology & Operations Management Unit

Date Written: January 21, 2021

Abstract

Several decades of expansion in digital communications, web commerce, and online distribution have altered regional IT labor market returns in the United States. IT occupations experienced similar wage growth as STEM occupations involving IT-related work activities, and wage inequality rose across locations and within MSAs. Supply side characteristics especially agglomeration and skilled labor pooling contributed to regional variation in IT wages since 2005. The size distribution of establishments in IT-using services industries increasingly drove IT wage inequality after 2012. While market concentration contributed to wage premiums across locations, establishment count contributed to within-MSA wage spread.

Suggested Citation

Cao, Ruiqing and Greenstein, Shane M. and Greenstein, Shane M., Digital Labor Market Inequality and the Decline of IT Exceptionalism (January 21, 2021). Harvard Business School Technology & Operations Mgt. Unit Working Paper No. 21-019, Available at SSRN: https://ssrn.com/abstract=3680099 or http://dx.doi.org/10.2139/ssrn.3680099

Ruiqing Cao (Contact Author)

Stockholm School of Economics ( email )

PO Box 6501
Stockholm, 11383
Sweden

Shane M. Greenstein

Harvard University - Technology & Operations Management Unit ( email )

Boston, MA 02163
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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