Monday, January 31, 2005

Technology and the labour market

Two interesting pieces of research from the LSE...

The first paper We Can Work It Out: the impact of technological change on the demand for low skilled workers by Alan Manning of LSE's Research Laboratory looks at how technology has shaped our working lives. Consensus view is that technical changes leads to an increase in demand for skilled relative to unskilled labour-- most Regional Development Agency policies are based on this (for example). This predicts a bleak future for unskilled workers. However this paper argues that the demand for the least skilled jobs may be growing since employment of the least skilled is increasingly dependent on physical proximity to the more skilled-- this is particularly true in cities (cf Saskia Sassen and globalisation).

The other piece of research by Tim Leung looks at the Yellow Pages to analyse which businesses are in decline and which are growing. Traditional high street businesses are in decline while aromatherapy, cosmetic surgery and dieting and weight control are the UK's most booming business sectors. Well you only have to look at the TV schedules to surmise that these are primary areas of interest. Along with property speculation (although I think that plastic surgery and makeovers seem to be crowding out DIY). Greengrocers, butchers, hardware retailers and farmers all lost out, while therapists (psycho- and hypno- among others) more than doubled. These trends are certainly very visible in London... it's easier to buy scented candles than meat! More details of this research at


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