ABOUT
This research examines how earnings and income inequality have evolved within and across generations, with a particular focus on the role of occupations. The first part of the study considers how demand for occupational tasks has shifted due to automation and job polarization. It studies how these changes have affected earnings and career paths for successive generations entering the workforce and how they have contributed to increasing inequality over time. The second part focuses on how differences in occupational employment help explain persistent racial and ethnic wage gaps. By examining the lifelong impact of occupational disparities, the study sheds light on how job types influence income inequality across demographic groups.
EXPECTED OUTCOMES
Over the past 50 years, the occupational structure of employment has undergone significant change, marked by the decline of middle-wage occupations—a phenomenon known as job polarization. Different labour market entry cohorts have encountered these shifts at various career stages, potentially influencing long-term earnings trajectories. If middle-wage occupations serve as “stepping stones” to higher-paying roles, cohorts entering the workforce during their decline may experience persistently lower life-cycle earnings. Preliminary findings reveal that Hispanic workers start their careers on lower rungs of the occupational ladder compared to White workers and advance at a slower pace, widening the wage gap over time.
HOW IT RELATES TO THE STONE CENTRE’S MISSION
Little is known about whether cohorts hit by polarization in their early career have substantially different employment and wage outcomes by mid-career relative to cohorts affected by polarization later in life. While a large body of research considers Black-White inequality, the relative outcomes of Hispanic workers have received much less attention from economists. Understanding why large and persistent gaps in labour market outcomes exist between groups defined by race and ethnicity is critical to understanding income inequality and (in)equality of opportunity, and is of public policy importance.