Occupations at risk: job tasks, job security, and wages

Germany, similar to other developed countries, witnessed a sharp decline in jobs that used to constitute the middle class in the 1970s and 1980s. This decline has been associated with the level to which jobs are codifiable. There is evidence that codifiable tasks are more prone to technological substitution and outsourcing compared with tacit tasks. This article empirically investigates two crucial aspects of the decline in codified jobs. First, it studies what happened to workers in codified occupations in terms of unemployment, occupational change, and wages. Second, it revisits the hypothesis that code-based technologies are the major driver of this labor market shift. We find that job codification is associated with both higher unemployment and higher occupational change. It is also associated with wage losses for workers who left routinized jobs. We find, however, little evidence that code-based technologies were the driving factor behind these dynamics.