Is Employment Globalizing?

The paper investigates the claim that national labor markets have become more globally interconnected in recent decades. It is done so by deriving estimates over time of three different notions of interconnection: (i) the share of labor demand that is export induced (i.e., all labor demand created by foreign entities buying products exported by the home country)—The paper provides estimates for 40 countries; (ii) the share of workers employed in sectors producing tradable goods or services—68 countries; and (iii) the ratio of the number of jobs that are either located in a tradable sector, or that are involved in producing services that are required by these tradable sectors, to all jobs in the economy, which it calls the trade-linked employment share—40 countries. The paper estimates lead to the conclusion that the evidence of a large increase in the interconnections between national labor markets is far weaker than commonly asserted: levels of interconnectivity, and the direction of changes over time, vary across notions of interconnection and countries.