The phenomenon of `job polarisation? is increasing inequality as the labour market splits into high- and low-wage work. According to Alan Manning, who coined the term a decade ago, we cannot ignore job polarisation ? but with sensible policies, we can manage it. Aiming for greater equality in the distribution of human capital is as important as ever. The most compelling explanation for job polarisation lies in the nature of technical progress: machines and software programs have been replacing employees in many routine jobs in the middle of the income distribution. But as Manning explains, while technology will undoubtedly continue to displace humans in some tasks, there is no reason to think that the jobs affected will always be the middle-skill ones.

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10 December 2013     Paper Number CEPCP398

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This CentrePiece article is published under the centre's Labour programme.