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Office of Survey Methods Research
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Published Year: 2022
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 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, wages are strongly related to occupational homogeneity, particularly for workers in low-wage occupations. Second, by some measures, workers—particularly those in lower-wage occupations—saw their employing establishments become more occupationally homogeneous during 2004-2019. 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 sorting and segregation by occupation of workers into different employers is an important part of wage inequality growth.