# **1 Introduction**

There is widespread evidence of both a wage and an employment premium at exporting vis-`a-vis non-exporting firms (Bernard and Jensen, 1999; Bernard, Jensen, Redding and Schott, 2007). In the literature, a leading mechanism behind these premia is the skilled labor utilization of exports. The production of goods for export utilizes skilled labor because exporting requires activities such as quality upgrades and operational services that are both intensive in high-quality labor (Verhoogen 2008; Matsuyama 2007). The supporting literature is large and includes Bernard and Jensen (1997), Brambilla, Lederman, and Porto (2012), Brambilla and Porto (2016), Caron, Fally and Markusen (2014), Fieler, Eslava and Xu (2017), Munch and Skaksen (2008), Serti, Tomasi and Zanfei (2010), S ̈oderbom and Teal (2000), Verhoogen (2008), Yeaple (2005).<sup>1</sup> In this paper, we look within skills and explore the type of skilled tasks demanded by exporting firms in Chile. We investigate whether these firms hire higher skilled workers for all possible tasks or, rather, whether the utilization of skilled labor is concentrated on more specific tasks in production or non-production activities. The literature on differential impacts of exports across tasks is much more scant and is circumscribed to developed countries (Bernini, Guillou and Treibich 2016; Caliendo and Rossi-Hansberg 2012; Caliendo, Monte and Rossi-Hansberg 2015; Caliendo, Mion, Opromolla and Rossi-Hansberg 2016; Friedrich 2016; Spanos 2016; Tag 2013).

To study the behavior of Chilean exporters, we use the Encuesta Nacional Industrial Anual (ENIA)—an annual census of manufacturing firms—and exploit detailed information of the firm demand of employment categories such as directors, specialized workers (engineers, professionals), administrators, blue-collar operatives, and maintenance services workers. The firm data from the ENIA is combined with administrative customs data on firms’ exports. This allows us to link the exporting status of a firm with the demand for skilled tasks and to track this link for several years. We show that Chilean exporters utilize more skills than Chilean non-exporters. However, the skill composition of employment matters. In particular, we show that exporters require the services of skilled specialized workers (engineers) as opposed to skilled administrative workers or managers. In addition, exporters demand less unskilled labor, especially blue-collar operatives. This suggests that exporters substitute skilled for unskilled labor in the provision of certain skill-intensive tasks used in production. We establish these results with an instrumental variable estimator, where we instrument the firm’s exports (as a share of total sales) with the weighted average of the changes in the exchange rate of all the firm’s international partners (Brambilla, Lederman, Porto 2012; Park, Yang, Shi and Jiang 2010; Verhoogen, 2008). We argue that our results thus estimated provide causal evidence of the skilled tasks demanded by exporters relative to non-exporters.

Our results contribute to a rather succinct literature on tasks utilized in exports. The theory on organizational structure and layers of employment launched by Caliendo and Rossi-Hansberg (2012) has been applied to French data (Caliendo, Monte and

> 1An extended version of this mechanism is the “quality-complementarity” hypothesis. Exports require higher quality products that need to be produced with high-quality inputs (labor, intermediate inputs, machines) at high-productivity firms. See Kugler and Verhoogen (2012) and Bastos, Silva and Verhoogen (2017).

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