the underlying “drivers” of skill demand are changing is the catalyst for growing interest in future skill demands. But, he said, if this hypothesis is correct, it means that researchers cannot simply look at patterns of occupational growth from the recent past and project them into the future. He suggested focusing instead on analyzing how the drivers are changing, in order to project future demand for various kinds of occupations and skills. This would provide a basis for thinking about how to reorient the education system.

Wanner said that he and colleagues at the Russell Sage Foundation have been trying to address this complex problem for years, since launching a research program on the Future of Work in 1994. He acknowledged that the research program “actually looked at the recent past of work,” examining why the wages of high school-educated workers have been in sharp decline over the past several decades. The research program examined several factors that might be reducing demand for—and wages of—high school-educated workers that are also on the agenda for this workshop, he said. These factors include changes in technology, increasing trade, offshoring of work, and immigration. However, Wanner said, research funded by the Future of Work program also found that an additional factor—the regulatory and labor market framework—is very important in determining wage levels.1 He observed that, in the United States, 25 percent of all employed workers earn less than two-thirds of the median gross hourly wage of all employees. By comparison, he said, the proportion of workers earning less than two-thirds of the median gross hourly wage is 8.5 percent in Denmark, 12.7 percent in France, and around 20 percent in Germany and the United Kingdom (Lloyd, Mason, and Mayhew, 2008). These differences indicate that wage levels (including the declining wages for high school-educated workers in the United States) should not be viewed only as a reflection of the interaction of supply and demand but also as a reflection of labor market institutions that in turn influence workers’ bargaining power.

Wanner’s comments on wages reflect a major divide in research and policy discussions on changing skill demands. Economic research often views wage differentials as reflections of skill differentials and interprets the widening wage gap between high school-educated and college-educated workers as evidence of rising demand for higher skills (Levy and Murnane, 2004). Other research methods, however, may examine how a range of forces—such as management decisions, labor laws, and the strength of labor unions—influence job content, skill demands, and wage levels. At the workshop, the tension between these two research perspectives provoked


This stream of research will be reported in The Russell Sage Foundation Series on Job Quality in Advanced Economies (case studies of 5 European nations), to be published in 2008.

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