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Labor demand in the past, present and future

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  • Georg Graetz

Abstract

Since the beginning of the Industrial Revolution, technological change has led to the automation of existing tasks and the creation of new ones, as well as the reallocation of labor across occupations and industries. These processes have been costly to individual workers, but labor demand has remained strong, and real wages have steadily increased in line with productivity growth. I provide evidence suggesting, however, that in recent decades automation has outpaced the creation of new tasks and thus the demand for labor has declined. There is strong disagreement about the future of labor demand, and predictions about technological breakthroughs have a poor track record. Given the importance of overall labor demand for workers' standard of living as well as their ability to adjust to a changing labor market, obtaining accurate forecasts should be a priority for policy makers.

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  • Georg Graetz, 2020. "Labor demand in the past, present and future," CEP Discussion Papers dp1683, Centre for Economic Performance, LSE.
    • Handle: RePEc:cep:cepdps:dp1683
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    Cited by:

    1. Graetz, Georg, 2020. "Technological change and the Swedish labor market," Working Paper Series 2020:19, IFAU - Institute for Evaluation of Labour Market and Education Policy.

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    More about this item

    Keywords

    automation; labor demand; labor share; technology; wages;
    All these keywords.

    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • 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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