ICT Services Exports and Labour Demand : A Global Perspective and the Case of Israel
In recent decades, economic growth around the world has mostly been driven by technological acceleration, along with growing consumer demand for information and communications technology (ICT) products and services. These developments have pushed ICT services exports to the forefront of the global trading system. However, overall employment in the ICT sector has not shown a similar expansion. This asymmetry could be partially explained by different employment trends prevailing in each ICT sub-sector, due to a shift in specialisation from manufacturing-intensive exports towards services-oriented exports. A particularly interesting country to examine in this regard is Israel, which has demonstrated outstanding performance in ICT services exports since the early 1990s, accompanied by a surge in demand for high-skilled employees. This article aims to identify the main determinants of labour demand in the ICT service sector across different country income groups and genders. The empirical cross-country panel analysis validates the positive contribution of ICT services exports to employment in the ICT service sector, particularly in high-income countries and among female employees. The article further highlights the considerable role of public policies in boosting labour demand in the ICT services sector, predominantly through funding for ICT research and development and tertiary education