Changes in the occupational structure of Nordic employment: Upgrading or polarization? Nordic Future of Work proejct 2017-2020: Working paper 2, 2nd edition

This paper studies whether the occupational structure in Nordic labour markets is changing in the direction of upgrading or polarization. Upgrading refers to an increase of the employment shares in highly skilled/paid occupations, while the shares in low-skilled/paid jobs decline. Polarization refers to simultaneously growing shares of employment in occupations in the high and low ends, while the share of occupations in the middle declines. According to previous research, there are some indications of polarization in Nordic labour markets in recent decades, although the evidence is not conclusive. The empirical data of this study stem from the Labour Force Surveys in Denmark, Finland, Norway and Sweden during the period 2000-2015. The results show clear tendencies towards polarization in Denmark, especially after the 2008 crisis, while upgrading is the dominant tendency in Norway in recent years. The
tendencies in Finland and Sweden lie between these two countries, showing clear
upgrading in the public sector and in goods production, while modest signs of polarization are found in the private sector. The tendencies in the services sector as a whole is more mixed. By studying the occupational changes in more detail, we find some evidence suggesting that technological change is a main driver of change. However, the analysis also indicates that political and economic factors influencing labour demand in the public and private sector respectively are important to take into consideration to understand occupational change in the Nordic region.