Current Issues in Economics and Finance
Second District Highlights

Job Polarization and Rising Inequality in the Nation and the New York-Northern New Jersey Region

Volume 18, Number 72012
JEL classification: J21, J24, J31, R10

Authors: Jaison R. Abel and Richard Deitz

Since the 1980s, employment opportunities in both the UnitedStates and the NewYork–northern NewJersey region have become increasingly polarized. While technological advances and globalization have created new jobs for workers at the high end of the skill spectrum and largely spared the service jobs of workers at the low end, these forces have displaced many jobs involving routine tasks—traditionally the sphere of middle-skill workers. Moreover, these same forces have pushed up wages for high-skill workers disproportionately, contributing to increased wage inequality. The rise in inequality has been especially sharp in downstate NewYork and northern NewJersey, where the wage gap is now markedly larger than in the nation.

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