Is that where you work or what you do? Understanding job polarization in Brazil

Although relatively well documented and accepted in the US and Europe, the notion of labour market polarization is not so clear in the developing world. In this study, I aim to answer two questions: (i) Are the patterns of employment and wage polarization seen in the industrialized countries also found in Brazil? And (ii) has the occupational structure--what you do--gained importance over the sectoral structure--where you work--in explaining the dynamics of the labour market. By applying standardized and reproducible aggregations of occupations by task content, I found strong evidence of employment polarization but not of wage polarization. Moreover, this study corroborates the idea that the occupational structure is a key driving force behind the determination of employment and wage dynamics, although further investigation is required to understand the relationship between job polarization and the wage distribution. This study also contributes to the literature by adjusting the classification of occupations (CBO) and activities (CNAE) to make the categories compatible before and after the 2002 changes. Thus, I preserved all the National Household Survey Sample’s (PNAD-IBGE) valid responses between 1981 and 2013.