in these two countries. In the Appendix we show that the rank correlation coefficient is high for the analytical and non-routine manual skills measures (0.75 and 0.67), is moderate for the interpersonal and routine manual skills measures (0.57 and 0.49), and negative for the routine cognitive measure (-0.77).

# **9. Summary and Discussion of Results**

In this paper we have analyzed the simultaneous impacts and interplay between a trade measure (value of goods exports per worker at the industry level) and a technology measure (share of households with a computer at the province level) on the demand for different types of skills and aggregate labor market indicators in Indonesia over the period 2005-2015. We based this analysis on four sources of data –the Indonesian National Labor Force Survey, the Indonesian National Socio-Economic Survey, the STEP Survey for Philippines, and the UN Comtrade database.

The analysis was separated into two sub-periods marked by a change in the focus of exports. The sub-period 2005-2010 was characterized by a commodity boom, while 2011-2015 exhibited a reduction in the value of exports that was larger for the mining industry than for manufacturing industries. Our conjecture is that this change implied an important shift in the demand for different types of skills as minerals, the main commodity of the country, used non-routine analytical and interpersonal skills more intensively in comparison to other industries, while manufactured products were more intensive in the use of non-routine manual and routine skills.

We hypothesized that our measure of the technological development available to a firm, the share of households with a computer in a firm’s province, is related to the structure of employment by skills in that province. However, the direction of the effect is not clear because the technology measure may be signaling the use of different types of technologies, not just computers, and these different technologies may have differing effects on the demand for skills. On the other hand, we expected firms facing an increase in the foreign demand for their products to increase their output level and their demand for certain types of skills, with the direction of the effects depending on the sub-period being analyzed due to the change of the export focus.

Our main results indicate that in 2005-2010 technology was complementary to analytical and interpersonal skills. When studying the interplay between the trade and technology measures, we find that exports and technological development reinforce each other --e.g. the demand for analytical and interpersonal skills increases with provincial technological development and increases more in industries with a higher value of exports per worker. This reinforcing effect is due to the characteristics of this sub-period, marked by strong increases in the export of commodities that used non-routine analytical and interpersonal skills more intensively relative to other industries. We also find evidence of technological development being labor-saving in Indonesia during 2005-2010 except for women, and exports being labor-increasing for higheducated and female workers.

For the 2011-2015 sub-period, increases in the value of exports increase the demand for analytical and interpersonal skills and decrease the demand for non-routine manual skills. This result supports the view that exporting is a skill-intensive activity in comparison to the production for 19