Services trade and labor market outcomes : evidence from Italian firms

Abstract

This paper empirically investigates the effects of services imports and exports on firm employment. We use microdata on Italian firms for the period 2009–2017. Applying a shift-share instrumental variable approach, we show that services imports and exports have a positive impact on total employment. This finding holds for managers, white-collar workers, and blue-collar workers. We also show that services exports are particularly effective in increasing employment of “servitized” manufacturing firms as well as of companies that are deeply integrated into international services markets. Overall, this paper suggests that firm employment might largely benefit from the services trade dimension of globalization.