Automation, Jobs, and Productivity: Aggregate and Micro Evidence
Saturday, Jan. 5, 2019 2:30 PM - 4:30 PM
- Chair: Erik Brynjolfsson, Massachusetts Institute of Technology
Automation, Labor Share, and Productivity: Plant-Level Evidence from United States Manufacturing
AbstractUsing plant-level information on manufacturing technology, this paper provides new evidence on the relationship between automation, labor and capital usage, and productivity. Plants with higher degree of automation have lower production labor share and higher capital share, and the ratio of capital and production labor shares increases significantly with the extent of automation. In addition, while production workers in technologically advanced plants receive higher wages and have higher labor productivity, they constitute a lower fraction of total plant employment in more automated plants. These observations suggest a production function that allows relative allocations of capital and production labor to depend on technology. Using a model of CES production with endogenous technology choice, total factor productivity is estimated at the plant level. The estimates are compared with results from more standard specifications, such as Cobb-Douglas. The nexus of productivity, labor share, and automation is characterized.
Individual Consequences of Occupational Decline
AbstractThe prospect of labor-replacing technologies raises concerns about earnings and employment losses that workers may suffer when demand for their occupations declines. We estimate these losses using a new methodology that measures unanticipated declines in occupational employment, which we apply to panel data on individual workers in Sweden. When we compare workers with very similar initial characteristics, we find that on average those facing occupational decline lost about 2-5 percent of mean cumulative earnings from 1986-2013. But workers at the bottom of their occupations’ initial earnings distributions suffered considerably larger earnings losses. These earnings losses are partly accounted for by reduced time spent in employment, and increased time in unemployment and retraining.
Complements or Substitutes? Firm-Level Management of Labor and Technology
AbstractLabor and technology can be treated as complements or substitutes in a firm’s production function, and the approach can vary across firms. A firm’s adoption of new technologies may therefore have very different implications for labor across different types of firms. In this paper we study how labor in the U.S. automotive supply chain is affected by firm-level adoption of new technologies, including machine vision, robots, sensors and other forms of digitization. We also categorize firm management into two generic types, those pursuing a pragmatist approach and those pursuing a Taylorist approach, and study how effects of adoption vary by these types. We use new data from an in-depth plant-level survey of automation and employment practices in the automotive supply chain conducted in early 2018 that we match to earlier plant-level data from 2011 in some cases.
- O3 - Innovation; Research and Development; Technological Change; Intellectual Property Rights
- J2 - Demand and Supply of Labor