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Working Paper
Can Pandemic-Induced Job Uncertainty Stimulate Automation?
The COVID-19 pandemic has raised concerns about the future of work. The pandemic may become recurrent, necessitating repeated adoptions of social distancing measures (voluntary or mandatory), creating substantial uncertainty about worker productivity. But robots are not susceptible to the virus. Thus, pandemic-induced job uncertainty may boost the incentive for automation. However, elevated uncertainty also reduces aggregate demand and reduces the value of new investment in automation. We assess the importance of automation in driving business cycle dynamics following an increase in job ...
Does Worker Scarcity Spur Investment, Automation and Productivity? Evidence from Earnings Calls
An analysis suggests labor issues like higher wages and hiring difficulties have prompted some firms to invest in automation, leading to productivity growth.
Working Paper
Reshoring, Automation, and Labor Markets Under Trade Uncertainty
We study the implications of trade uncertainty for reshoring, automation, and U.S. labor markets. Rising trade uncertainty creates incentive for firms to reduce exposures to foreign suppliers by moving production and distribution processes to domestic producers. However, we argue that reshoring does not necessarily bring jobs back to the home country or boost domestic wages, especially when firms have access to labor-substituting technologies such as automation. Automation improves labor productivity and facilitates reshoring, but it can also displace jobs. Furthermore, automation poses a ...
Working Paper
Understanding Growth Through Automation: The Neoclassical Perspective
We study how advancements in automation technology affect the division of aggregate income between capital and labor in the context of long-run growth. Our analysis focuses on the fundamental trade-off between the labor-displacing effect of automation and its positive productivity effect in an elementary task-based framework featuring a schedule of automation prices across tasks linked to the state of technology. We obtain general conditions for the automation technology and technical change driving automation to be labor-share displacing. We identify a unique task technology that reconciles ...
Working Paper
Robots, Tools, and Jobs: Evidence from Brazilian Labor Markets
What is the effect of robots and tools on employment and inequality? Using natural language processing and an instrumental variable approach, we discover that robots have led to a sizable decrease in the employment and wages of low-skill workers in operational occupations. However, tools — machines that complement labor — have led to an equally large reinstatement of these workers, increasing their employment and wages. Using a quantitative model, we find that the lower prices of robots and tools over the last 20 years have reduced inequality and increased welfare without a significant ...
Working Paper
The Covid-19 Pandemic Spurred Growth in Automation: What Does this Mean for Minority Workers?
The Covid-19 pandemic has accelerated trends in automation as many employers seek to save on labor costs amid widespread illness, increased worker leverage, and market pressures to onshore supply chains. While existing research has explored how automation may displace non-specialized jobs, there is typically less attention paid to how this displacement may interact with preexisting structural issues around racial inequality. This analysis updates that of a 2021 Brookings paper by the authors, finding that Black and Hispanic workers continue to be overrepresented in the 30 occupations with the ...
Journal Article
The Resurgence of Universal Basic Income
Concerns about the effects of automation have brought an old policy proposal back into the limelight
Working Paper
Occupational Switching During the Second Industrial Revolution
During the Second Industrial Revolution, in the late nineteenth century, the proliferation of automation technologies coincided with substantial job creation but also a “hollowing out” of middle-skilled job opportunities, which historically offered reliable paths to prosperity. We use recently linked U.S. census data to document three main facts: (i) declining demand for middle-skilled labor in manufacturing corresponded to greater reallocation of workers into comparatively less-skilled occupations; (ii) older workers were more likely to switch to unskilled physical labor; (iii) younger ...
Race and the Threat of Job Loss from Automation
Kristen Broady, fellow at Brookings Metro, discusses the vulnerability of Black and Hispanic workers to automation.
Discussion Paper
“Forced Automation” by COVID-19? Early Trends from Current Population Survey Data
This empirical study evaluates whether COVID-19 and the threat of future pandemics has expedited the process of automation in the U.S. The results suggest that the pandemic displaced more workers in automatable occupations, putting them at a greater risk of being permanently automated. The automatable jobs that are more vulnerable to the pandemic include jobs that do not permit remote work, have a high risk of COVID-19 transmission, or are in the most affected sectors. While most of the job losses during the pandemic are expected to be temporary, a replication of the analysis for the Great ...