Employment in the United States is becoming increasingly polarized, growing ever more concentrated in the highest- and lowest-paying occupations and creating growing income inequality. As the Dallas Fed explains, market changes involving middle-skill jobs in the U.S. are hastening labor market polarization. So-called "Routine" jobs have declined from 58% of employment in 1981 to 44% in 2011, while both types of non-routine jobs have expanded. The number of routine jobs declined in every recession since 1970, as did most other types of jobs. However, routine jobs always rebounded during the economic expansions that followed the recessions of the 1970s and 1980s.

This pattern changed dramatically in the three recessions since 1990. None of the routine jobs lost in these downturns came back in the following expansions.

This is a problem since middle-skill, routine jobs still account for almost half of all existing jobs; and as the Dallas Fed concludes, the pace of labor market polarization is unlikely to slow down anytime soon.

Source: Dallas Fed