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Skills-Displacing Technological Change and Its Impact on Jobs: Challenging Technological Alarmism?

Author

Listed:
  • McGuinness, Seamus

    () (Economic and Social Research Institute, Dublin)

  • Pouliakas, Konstantinos

    () (European Centre for the Development of Vocational Training (Cedefop))

  • Redmond, Paul

    () (ESRI, Dublin)

Abstract

We use data from a new international dataset - the European Skills and Jobs Survey - to create a unique measure of skills-displacing technological change (SDT), defined as technological change that may render workers' skills obsolete. We find that 16 percent of adult workers in the EU are impacted by SDT, with significant variance across countries, ranging from a high of 28 percent in Estonia, to below seven percent in Bulgaria. Despite claims that technological change contributes to the deskilling of jobs, we present evidence that SDT is associated with dynamic upskilling of workers. The paper also presents the first direct micro-evidence of the reinstatement effect of automating technology, namely a positive contribution of automation to the task content and skills complexity of the jobs of incumbent workers. Despite the recent focus on the polarising impact of automation and associated reskilling needs of lower-skilled individuals, our evidence also draws attention to the fact that SDT predominantly affects higher-skilled workers, reinforcing inequalities in upskilling opportunities within workplaces. Workers affected by SDT also experience greater job insecurity.

Suggested Citation

  • McGuinness, Seamus & Pouliakas, Konstantinos & Redmond, Paul, 2019. "Skills-Displacing Technological Change and Its Impact on Jobs: Challenging Technological Alarmism?," IZA Discussion Papers 12541, Institute of Labor Economics (IZA).
  • Handle: RePEc:iza:izadps:dp12541
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    References listed on IDEAS

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    More about this item

    Keywords

    technological change; automation; skills; tasks; skill mismatch; skills obsolescence;

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

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