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Digital adoption and human capital upscaling: a regional study of the manufacturing sector

Author

Listed:
  • Roberto Moncada

    (University of Turin
    LINKS Foundation
    Collegio Carlo Alberto)

  • Francesco Carbonero

    (University of Turin)

  • Aldo Geuna

    (Collegio Carlo Alberto
    University of Turin
    Canadian Institute for Advanced Research (CIFAR))

  • Luigi Riso

    (Catholic University)

Abstract

We study the effect of the diffusion of digitalization, measured as the level of expenditures in digital technologies, on labor demand within the manufacturing sector. We exploit unique information from a focus study of the quarterly survey of Unioncamere Piemonte (one of Italy’s most industrialized and technologically advanced regions) to measure the extent to which planned digital technologies investments impact hiring propensity, differentiated by educational level. Based on a representative sample of non-micro firms, our findings suggest a positive relationship between digital investments and the probability of hiring highly educated workers, mainly driven by the demand for individuals with a post-secondary technical institute (ITS) diploma and post-MSc qualifications or a PhD in STEM fields. Conversely, we also find that digital investments negatively influence the probability of hiring low-educated individuals, primarily referring to the demand for workers with secondary education. Our results reveal firms’ human capital upscaling dynamics powered by digitalization processes.

Suggested Citation

  • Roberto Moncada & Francesco Carbonero & Aldo Geuna & Luigi Riso, 2025. "Digital adoption and human capital upscaling: a regional study of the manufacturing sector," Small Business Economics, Springer, vol. 64(4), pages 2061-2103, April.
    • Handle: RePEc:kap:sbusec:v:64:y:2025:i:4:d:10.1007_s11187-024-00975-3
    DOI: 10.1007/s11187-024-00975-3
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    More about this item

    Keywords

    Digitalization; Hiring propensity; Education; Human capital upscaling; Digital technologies;
    All these keywords.

    JEL classification:

    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • M51 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Firm Employment Decisions; Promotions

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