International Outsourcing and the Skill Structure of Labour Demand in the United Kingdom

Hijzen, Alexander; Görg, Holger; Hine, Robert C.

doi:10.1111/j.1468-0297.2005.01022.x

International Outsourcing and the Skill Structure of Labour Demand in the United Kingdom

Economic Journal, Vol. 115, No. 506, pp. 860-878, October 2005

19 Pages Posted: 7 Dec 2005

See all articles by Alexander Hijzen

Alexander Hijzen

Organization for Economic Co-Operation and Development (OECD)

Holger Görg

University of Kiel; Kiel Institute for the World Economy

Robert C. Hine

University of Nottingham - Department of Economics

There are 2 versions of this paper

Abstract

This article investigates empirically the link between international outsourcing and the skill structure of labour demand in the UK. It is the first detailed study of this issue for the UK. Outsourcing is calculated using import-use matrices of input-output tables for manufacturing industries for the period 1982 to 1996. Estimating a system of variable factor demands, our main results show that international outsourcing has had a strong negative impact on the demand for unskilled labour. Hence, international outsourcing is an important component in explanations of the changing skill structure of manufacturing industries in the UK.

Suggested Citation: Suggested Citation

Hijzen, Alexander and Gorg, Holger and Hine, Robert C., International Outsourcing and the Skill Structure of Labour Demand in the United Kingdom. Economic Journal, Vol. 115, No. 506, pp. 860-878, October 2005. Available at SSRN: https://ssrn.com/abstract=856691 or http://dx.doi.org/10.1111/j.1468-0297.2005.01022.x