Skip to main content

Industrial Composition and Intergenerational Mobility


For five decades, the share of adults employed in college-degree-intensive industries, such as health care and education, has been rising. Industries that provided employment for workers without degrees, especially manufacturing, have been reducing their payrolls. This economic transition could impact the probability of children obtaining higher levels of education than their parents achieved. In this analysis, measures of the local industrial composition from the Current Population Survey are merged with the National Longitudinal Surveys of Youth using the confidential geo-coded records. Living in a labor market with a higher share of adults employed in degree-intensive industries is positively associated with obtaining a college degree among youth whose parents do not have a degree. An additional standard deviation difference in the share of employment in degreeintensive industries corresponds to a 0.02 increase in the probability of ascending to being a college graduate, from a mean of 0.23. For cohorts born in the 1960s, living in a manufacturing-intensive region was negatively correlated with college attainment, but the relationship becomes positive among more recent cohorts. Alternate specifications introduce measures of several factors that could relate the industrial composition to educational attainment, including returns to education (wage premiums), opportunity costs (youth employment), parental inputs (family structure, income), community resources (per capita income), information (regional education levels, post-secondary student populations), and networks (parent’s employment).

Keywords: Industrial Composition, Intergenerational Mobility, Educational Attainment

JEL Codes: E24, J24, O14, R11.


Suggested citation: Whitaker, Stephan, 2015. “Industrial Composition and Intergenerational Mobility,” Federal Reserve Bank of Cleveland, Working Paper no. 15-33.

Upcoming EventsSEE ALL

  • 09.15.22

    FedUniversity: Internships at the Federal Reserve Bank of Cleveland

    Join us on September 15, noon to 1:00pm, to learn about the Cleveland Fed’s annual internship program.

  • 09.29.22

    Inflation: Drivers and Dynamics 2022

    Inflation: Drivers and Dynamics 2022, co-sponsored by the Center for Inflation Research and the European Central Bank will take place on September 29-30, 2022 in Cleveland, OH.

  • 10.06.22

    Conference on Real-Time Data Analysis, Methods, and Applications

    The Federal Reserve Bank of Cleveland is sponsoring the Annual Conference on Real-Time Data Analysis, Methods, and Applications in Macroeconomics and Finance to be held in Cleveland, Ohio, at the Cleveland Reserve Bank on Thursday and Friday, October 6–7, 2022.

  • 11.07.22

    Women in Economics Symposium

    Join the Federal Reserve Bank of Cleveland at the Women in Economics Symposium, which aims to encourage women to pursue a career in economics by discussing the successful career paths of diverse economics professionals and raising awareness of diversity and inclusion in the profession.

  • 11.17.22

    2022 Financial Stability Conference: Frontier Risks, a New Normal, and Policy Challenges

    The Federal Reserve Bank of Cleveland and the Office of Financial Research will host their 10th annual financial stability conference on November 17–18, 2022. This year’s conference is titled Financial Stability: Frontier Risks, a New Normal, and Policy Challenges.