Risks, resources and rewards at the frontier of labor market change – analyzing careers in young knowledge intense firms using Swedish registry data

A body of policy-oriented research, dating back to the Rehn-Meidner model, deals with how to enable labor market change without harming those whose jobs are affected by it.

Research on structural change in welfare states has described how jobs requiring a tertiary education grow at the cost of jobs requiring less skills, and how the rise of the service sector occur in parallel with a decline of the manufacturing sector.

Neo-Schumpeterian economic research has additionally documented the impact of ‘young’ and ‘innovative’ firms on the creation and destruction of jobs.This project combines insights from these typically separate perspectives by analyzing risks, resources and rewards associated with careers in young and innovative firms.

Factors predicting entry into such firms are analyzed as well as outcomes associated with such pathways. To what extent do these careers produce unfavorable personal outcomes, such as wage loss or career instability?

How important are worker characteristics, such as a lack of relevant human capital, for the transition from declining to upcoming firms?Labor market policy has an important part to play in helping workers maneuver through labor market change, but in order to design such policies properly, more knowledge is needed about what factors actually enable individuals to make valuable transitions into expanding sectors of the economy.A main reason why these questions have not been sufficiently addressed before has been a lack of suitable representative data.

The proposed project use person-firm linked administrative data on the whole population of Sweden.

Organizations can be followed from 1986 to 2020, i.e. for 35-years.In sum, by merging the typically distinct perspectives of welfare research and innovation studies, the project updates models of how to achieve successful structural change with minimal transition costs for the individual workers involved.