The present recession has brought into stark focus this question: Which occupations are more vulnerable to job loss? Since shocks to the economy affect employment across multiple occupations, we employ a new approach to assess the vulnerability of jobs due to such shocks by measuring how diversified an occupation is across sectors. Using U.S. employment data between the years 1999 and 2005, which include the downturn in the aftermath of the internet bust and the subsequent recovery, we find that an occupation spread across multiple industries is less volatile in terms of both numbers employed and the average wage. The result is robust to occupation size. Including various measures of an occupation's "footloose" nature and geographical mobility does not affect the results. The evidence presented distills a key lesson from a previous downturn and recovery, and could improve our understanding of issues relating to business cycles, offshoring and higher education.
©2011 Walter de Gruyter GmbH & Co. KG, Berlin/Boston