We test whether employment growth of male worker’s initial industry influences earnings growth using the 1979 National Longitudinal Survey of Youth. We follow workers for 20 years after reporting their first industry finding that lower employment growth in initial industry implies substantially lower earnings growth. Notably, after controlling for observable skills, controls for family background and region have no impact on estimates. Effects appear larger for initial occupations that involve more routine or manual tasks, as well as for occupations that involve less abstract tasks, but these differences are not statistically significant.
First version, January 8, 2021
J20: Demand and Supply of Labor: General
J30: Wages, Compensation, and Labor Costs: General
O30: Technological Change; Research and Development; Intellectual Property Rights: General