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Sustainable trade

Less-educated men hit hard by technological shift in job market

Published 10 August 2017

American workers are increasingly anxious about robots and automation replacing them in their jobs. The underlying dynamic is that jobs are changing because of automation, not disappearing. That's not a concern in and of itself. The concern is that not everyone is on good footing to adjust.

American workers are increasingly anxious about robots and automation replacing them in their jobs. They picture a world out of a science fiction novel where people lose their pathways to earn a living along with their sense of control over their circumstances.

This stark narrative obscures the underlying dynamic of progress — jobs are changing because of automation, not disappearing. That’s not a concern in and of itself. The concern is that not everyone is on good footing to adjust. Less-educated males are bearing the brunt of the sharp labor market swing away from jobs that rely on physical labor. Technological advances and the “automation” of tasks have resulted in more jobs that require technical training or education. Despite the limited job prospects for less-educated men, males have been less aggressive than females in attaining more education.

Mind over Matter

Since 1982, workers making a living with their minds — deploying skills and technical abilities — have increasingly outnumbered workers making things with their hands.

In Figure 1, employment data from the Bureau of Labor Statistics is divided into industries and occupations dependent on manual labor (‘hands’) versus industries and occupations dependent on knowledge (‘minds’). The ‘hands’ group is the goods-producers in industries such as mining and logging, manufacturing, and construction. The ‘minds’ group includes information, financial activities, professional and business activities, and education and health services. The remaining sectors are trade, transport, and utilities; leisure and hospitality; and, other services.

This shift in types of jobs available in the U.S. job market occurred well before China joined the WTO in 2001, and there was no discernable change in trend during the period of hyper-globalization in the late 1990s and early 2000s.

Figure 1. Percent of private nonfarm U.S. workforce, by groups, 1970-2016

Men Absorb the Brunt of the Workforce Shift

In 1970, jobs dependent on physical labor made up 38 percent of the job market; today it’s just 16 percent. Because men occupy three quarters of the jobs dependent on physical labor, they have been most negatively impacted by the steady decline in these types of jobs.

Women, on the other hand, occupied half of the ‘minds’ jobs back in 1970. As more women enrolled and stayed in school and entered the work force in greater numbers, they benefitted disproportionately from the increase in ‘minds’ jobs which jumped from 26 to 44 percent of the job market.

Employment Growth (2005-2014), by Education and Gender

Source: BLS data on detailed occupation, employment and gender, 2005 and 2014. Male occupations include all jobs where more than 60 percent of workers are men. The occupational data are divided into quintiles, by the average years of education, weighted by the size of the occupation in 2005.

The Robots are After “Men’s” Jobs

Not only is the U.S. economy shifting away from jobs dependent on ‘hands,” manual labor is more rapidly displaced by technologies. Occupations predominantly held by men with a high school degree or less (the bottom 40 percent in Figure 2) such as metalworkers, printing press operators, and carpenters, have seen precipitous declines of more than 25 percent since 2005. In contrast, predominantly female occupations that require less education such as personal care aides, models, bakers, and manicurists, have experienced strong employment growth despite a slowing economy.

Job prospects are limited for just about all occupations that require some college or an associates degree. Many of these occupations have also been affected by technological progress. They include jobs like courier and messengers, telecommunication line installers, and toolmakers traditionally held by men, along with typists, file clerks, and data entry jobs traditionally held by women.

Tariffs and Taxes Won’t Reverse the Trends

The U.S. economy shifted away from jobs dependent on ‘hands’ in favor of jobs dependent on ‘minds’ decades ago. Trade and tax policies will not undo this paradigm shift in the job market or reverse technological progress.

A large chunk of our workforce is being left behind and the problem is especially acute for less educated males. Greater openness to occupational choices that cross traditional gender lines would expand the opportunities for men, but history suggests that jobs occupied mostly by women tend to stay that way. The best way to expand job prospects is greater investment and increased enrollment in education and job training. Smarter policies are needed to ensure education and quality training outside of college are accessible and attractive for men and women alike.

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Caroline Freund is Global Director of Trade, Investment and Competitiveness at the World Bank Group.

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Christine McDaniel is a senior research fellow with the Mercatus Center at George Mason University.

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