occupations, but with more routine-intensive tasks in other services. Focusing on the skill content of occupations as a robustness check shows that results for high-skilled occupations somewhat resemble those for non-offshorable occupations. In contrast, results for medium- and low-skilled occupations resemble those for offshorable occupations.

Third, we studied the contribution of GVC participation to within-country wage inequality: direct and indirect through its relationship with the workers’ RTI. GVC participation is associated with larger wage inequality in most high-income countries, but with reduced wage inequality in most low- and middle-income countries. Its indirect contribution to wage inequality – widening the gap between the RTI of workers in offshorable occupations in the industrial sector and workers in non-offshorable occupations in business services sectors – is a crucial mechanism.

Understanding the differences in the RTI of workers across the development spectrum and its relationship with fundamental factors – technology adoption, skill supply, and globalization – has important policy implications. The transition from routine to non-routine work has been a key dimension of structural change in labor markets, increasing worker productivity and earnings. Jobs with a higher non-routine content involve higher levels of technology, require higher skill levels, and offer higher earnings between and within occupations (Autor & Handel, 2013; de la Rica et al., 2020). Diverging effects of globalization on the RTI of different types of workers can thus contribute to wage inequality within countries.

At the same time, cross-country differences in RTI, especially between high- versus low- and middle-income countries, are larger than implied by mere cross-country differences in skills supply, as they can be mainly attributed to differences in technology use (Lewandowski et al., 2022). Investments in education and skills in developing and emerging economies are frequently cited as necessary conditions to foster shared prosperity (World Bank, 2019). They are also often highlighted to counter the adverse labor market effects of increased technology adoption in developing countries. The mediating role of worker skills becomes even more urgent amid rapid advances in artificial intelligence, such as recent developments of Chat-GPT and GPT-4. While they are most likely required to achieve these goals, they are unlikely to be sufficient, given that differences in job task content are largely related to differences in technology use and participation in GVCs. In any case, policies to increase technology use and approaches to facilitate upgrading in GVCs should complement investments in skills, especially since technological change within GVCs tends to increase the relative demand for non-routine work (Reijnders & de Vries, 2018).

Our study has limitations. First, it does not claim to have determined a causal effect. Since the survey data were collected once per country, only cross-sectional analysis is possible. The analysis therefore cannot capture wage changes over time or cases where GVC participation created new labor market segments that did not exist before. In the future, the second round of PIAAC data collection will allow running a quasi-panel study to study the relationship between changes in GVC participation, technology use, and the supply of skills, with the RTI of particular occupations in various countries. Second, the survey data do not distinguish between domestic and foreign-owned firms, so it is unclear if FDI correlates with RTI differences within sectors. Lewandowski et al. (2022) showed that FDI is not a significant factor behind RTI differences between sectors, but there may be a relationship within sectors. Third, adult skill surveys have greatly improved our understanding of skills supply and the quality of education worldwide. It is possible, though, that literacy or numeracy measures are insufficient to fully understand factors behind differences in the nature of work, task content of jobs, and productivity. Differences in managerial and interpersonal skills may also contribute to differences in organizing and performing work. These skills are unfortunately not measured in the same survey data that capture worker tasks. Finally, the estimated contribution of technology adoption to worker-level RTI may likely increase in the 18