Job polarization and task prices in the Brazilian labor market

In most developed countries, technological change shifted the occupation structure towards cognitive and manual jobs. Jobs intensive in those two tasks saw an increase in both employment and earnings, to the detriment of routine intensive jobs. We provide evidence that this phenomenon also occurs in a large middle-income country, namely Brazil. We propose an alternative way to analyze wage polarization by estimating task prices using panel data at the individual level. We measure the occupation's task content using a continuous index instead of segregating them into broad exclusive groups. By measuring tasks content this way, we can preserve information on occupational task requirements, especially in occupations with a high level on more than one task. We show that when one uses task price, polarization emerges in earnings. Similar to what is found by the literature for other countries, technological change increased earnings – measured by task price – in manual and cognitive tasks, and decreased in routine ones, over the period studied.