Occupational Mobility, Career Progression and the Hourglass Labour Market Craig Holmes and Ken Mayhew Government Equalities Office and ESRC seminar on Social Mobility and Equality: early years, educations and transition to the labour market, October 18 th 2012

The hourglass labour market Routinisation hypothesis (Autor, Levy and Murnane, 2003): – Computer capital replaces tasks, not skills – Labour employed in routine tasks can be swapped for technology – Occupations performing non-routine tasks grow Polarisation hypothesis (Goos and Manning, 2007) – Routine occupations found in middle of income distribution – Non-routine occupations found at top and bottom of distribution Professional8.7%12.4%14.4% Managerial11.1%15.6%14.8% Intermediate9.5%13.4%13.7% Routine51.3%37.9%30.8% Manual5.8%4.8%5.8% Service13.7%15.8%20.5%

The hourglass labour market Less obvious in earnings than in occupational titles (Holmes and Mayhew, 2012) Change in occupational structure affects progression paths and mobility patterns – Focus is on the room at the top. – Little said about room at the bottom Three issues: – Who moves from routine jobs? – What does this change mean for low-wage workers? – Do earnings mobility and occupational mobility go together?

Cohort studies: how much mobility is displacement? Is this mobility upward, downward, or outwards? Where do routine workers go? Probability of staying in routineA-Levels and equivalentGraduates Decline of routine jobs:0%10%DISP0%10%DISP NCDS (1958 cohort)95%85%10%***88%67%20%*** BCS (1970 cohort)82%78%3%***62%57%5%*** 10% decline in routine jobs Probability of moving to... ProfessionalManagerialIntermediateServiceUnemployedInactive NCDSNon-graduate 2.6%5.6%2.3%0.4%0.6%1.1% Graduate 18.4%11.7%5.1%0.2%-0.4%1.0% BCSNon-graduate 0.7%1.3%2.0%0.3%-1.6%0.2% Graduate -17.2%-1.6%-1.9%0.4%-1.9%0.8%

Room at the top? Paths to the top may not depend purely on qualifications – Hard to explain difference between BCS and NCDS mobility – Type of job matters – internal labour markets create more stable pathways and protect against shocks – BCS cohort may position themselves better within routine jobs – implies barriers to mobility for older NCDS cohort workers Little strong evidence of changes in progression paths of service workers – Some transitions linked to career paths e.g. in healthcare or retail ManagerialProfessionalIntermediateRoutineManualServiceUnemployedInactive %0.2%0.8%2.5%0.1%86.6%2.7%6.2% %0.4%1.3%3.3%0.1%88.0%1.3%4.5% %0.5%0.9%2.2%0.1%87.4%3.0%5.2%

Occupational mobility and earnings Occupational transitions are not always associated with the expected higher earnings

Occupational mobility and earnings Returns to holding a degree vary significantly over the distribution – supply exceeding demand in places?

Conclusion Occupational structure has been a key driver of mobility in the past Structural changes affect career paths, which shape progression opportunities Education, qualification and human capital data can not adequately explain all of these trends – need to remember non human capital barriers to mobility Evidence that the room at the top benefits the whole labour market is limited

Contact Details Craig Holmes ESRC Centre on Skills, Knowledge and Organisational Performance (SKOPE), Department of Education, Norham Gardens, Oxford