Moving to the Good Occupations across Generations: Sociotechnical Factors Promoting Economic Growth

Abstract

Economic growth is a general equilibrium process which usually differs in one era compared to others. To effect growth there will be a changing occupational composition. Relatively few persist in the same occupations as their parents and movement across occupations occurs even in a hypothetical stationary economic environment. Yet, understanding distinct patterns and likely forces shaping overall change for a given era is a way to assess the growth process. Based on a coding of parental occupations to the 2000 Census in the Panel Study of Income Dynamics (PSID) we are able to study the extent and nature of growth promoting migration to occupations across generations. In the recent U.S. time frame family processes have operated in the context of the rise of information technology in the form of STEM and AI occupations and, for women, a notable exodus from housekeeping to a wide range of market occupations. Migration across these ostensibly nominal occupational categories leads to occupational economic mobility, upward or downward. Here, mobility is measured by the change in the wage ranking by occupation of adult children compared to that of their parents. Wage rankings are measured by the occupation specific calculated wage from extensive information on the full work settings in the prior calendar year. Specifically, moving to an occupational with a higher wage is seen as moving to a good occupation. Our method provides a synthesis of intergenerational analysis which looks at a summary income measure on the one hand, and movement across diverse occupational boundaries on the other. A benefit of our empirical approach is that it allows us to compare the mobility of both men and women and to quantify the economic growth attributable to women’s notable departure from their mother’s occupation as a homemaker. The reference wage year is 2012 and the report of parental occupations extends back to the years when almost 45 percent of all the mothers of the current adult women and men were reported as home makers when the now adult child was growing up.