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Office of Survey Methods Research
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Published Year: 2020
Survey/Program(s): Office of Employment and Unemployment Statistics
Catalog: Economic Working Paper
WP Number: WP-522
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Outsourcing, Occupationally Homogeneous Employers, and Growing Wage Inequality in the United States
Abstract
This paper develops measures of the occupational homogeneity of employers as indicators of outsourcing. Findings are threefold. First, workers—particularly those in low-wage occupations who worked in smaller establishments—saw their employing establishments become more occupationally homogeneous during 2004-2019. Second, wages are strongly related to occupational homogeneity, particularly for workers in low-wage occupations. Third, changes in the occupational homogeneity of workplaces are an important contributor to growing wage inequality among workers over the first half of this period. The growing separation of workers in low-wage occupations into different employers from workers in high-wage occupations is an important part of wage inequality growth.