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Threats and opportunities in the digital era: Automation spikes and employment dynamics

Author

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  • Domini, Giacomo
  • Grazzi, Marco
  • Moschella, Daniele
  • Treibich, Tania

Abstract

This paper investigates the change in worker flows (i.e. net growth, but also hiring and separation rates) around an investment in automation-intensive goods and, within firms, across occupational categories. Resorting to an integrated dataset encompassing detailed information on firms, their imports, and employer-employee data for French manufacturing employers over the period 2002–2015, we identify ‘automation spikes’ using imports of capital goods embedding automation technologies. Even after controlling for firms’ non-random selection into automation, we find that automation spikes are linked to an increase in firms’ contemporaneous net employment growth rate, jointly explained by a higher hiring rate and a lower separation rate. Furthermore, we find that automation spikes are not associated with significant changes in the composition of the workforce (in terms of 1-digit and 2-digit occupational categories, and routine-intensive vs. non routine-intensive jobs).

Suggested Citation

  • Domini, Giacomo & Grazzi, Marco & Moschella, Daniele & Treibich, Tania, 2021. "Threats and opportunities in the digital era: Automation spikes and employment dynamics," Research Policy, Elsevier, vol. 50(7).
  • Handle: RePEc:eee:respol:v:50:y:2021:i:7:s0048733320302122
    DOI: 10.1016/j.respol.2020.104137
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    More about this item

    Keywords

    Automation; Gross worker flows; Skills; Technological change;
    All these keywords.

    JEL classification:

    • D25 - Microeconomics - - Production and Organizations - - - Intertemporal Firm Choice: Investment, Capacity, and Financing
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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