Permanently Displaced? Increasingly Disconnected? Labor Force Participation in U.S. States and Metropolitan Areas

27 Pages Posted: 1 Aug 2018

See all articles by Benjamin Hilgenstock

Benjamin Hilgenstock

Institute of International Finance

Zsoka Koczan

International Monetary Fund (IMF)

Date Written: May 2018

Abstract

The United States stands out among advanced economies with marked declines in labor force participation. National averages furthermore conceal considerable within-country heterogeneity. This paper explores regional differences to shed light on drivers of participation rates at the state and metropolitan area levels. It documents a broad-based decline, especially pronounced outside metropolitan areas. Using novel measures of local vulnerability to trade and technology it finds that metropolitan areas with higher exposures to routinization and offshoring experienced larger drops in participation in 2000-2016. Thus, areas with different occupational mixes can experience divergent labor market trajectories as a result of trade and technology.

Keywords: Labor force participation, Labor markets, Employment, United States, exposure to routinization, exposure to offshoring, technology, automation, Trade and Labor Market Interactions, Globalization: Labor, Labor Force and Employment, Size, and Structure, Size and Spatial Distributions of Regional Economic Activity

JEL Classification: F16, F66, J21, J23, R12

Suggested Citation

Hilgenstock, Benjamin and Koczan, Zsoka, Permanently Displaced? Increasingly Disconnected? Labor Force Participation in U.S. States and Metropolitan Areas (May 2018). IMF Working Paper No. 18/118, Available at SSRN: https://ssrn.com/abstract=3221197

Benjamin Hilgenstock (Contact Author)

Institute of International Finance ( email )

1333 H Street, NW
Suite 800E
Washington, DC 20005-4770
United States

Zsoka Koczan

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

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