What Kind of Job is Safer? A Note on Occupational Vulnerability

The B.E. Journal of Economic Analysis & Policy, Vol. 10, No. 1, 2010

17 Pages Posted: 23 May 2007 Last revised: 20 Mar 2010

See all articles by Ashok Bardhan

Ashok Bardhan

University of California, Berkeley - Haas School of Business

John P. Tang

ANU Research School of Economics

Date Written: October 1, 2006

Abstract

The present recession has brought into stark focus this question: Which occupations are more vulnerable to job loss? Since shocks to the economy affect employment across multiple occupations, we employ a new approach to assess the vulnerability of jobs due to such shocks by measuring how diversified an occupation is across sectors. Using U.S. employment data between the years 1999 and 2005, which include the downturn in the aftermath of the internet bust and the subsequent recovery, we find that an occupation spread across multiple industries is less volatile in terms of both numbers employed and the average wage. The result is robust to occupation size. Including various measures of an occupation’s “footloose” nature and geographical mobility does not affect the results. The evidence presented distills a key lesson from a previous downturn and recovery, and could improve our understanding of issues relating to business cycles, offshoring and higher education.

Keywords: labor market volatility, unemployment, diversification, offshoring

JEL Classification: J21, J24, J31, J6, F16, F2

Suggested Citation

Bardhan, Ashok and Tang, John P., What Kind of Job is Safer? A Note on Occupational Vulnerability (October 1, 2006). The B.E. Journal of Economic Analysis & Policy, Vol. 10, No. 1, 2010, Available at SSRN: https://ssrn.com/abstract=985609 or http://dx.doi.org/10.2139/ssrn.985609

Ashok Bardhan

University of California, Berkeley - Haas School of Business ( email )

545 Student Services Building, #1900
2220 Piedmont Avenue
Berkeley, CA 94720
United States

John P. Tang (Contact Author)

ANU Research School of Economics ( email )

LF Crisp Building 26
Canberra, Australian Capital Territory 0200
Australia

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