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Robots versus jobs?

A survey just published by Bank of Italy helps shed light on one of the most important issues for industrial production

Robots versus man. Automation versus employment. Clashing opposites. The conflict between human labour and machine work is a subject as old as the Industrial Revolution. At the end of the day, the ideologies and the economic and industrial policy settings that have made history were built on this conflict. It is certainly true that the advent of machines (digitalisation and robots today), brought about major changes at work in some way. We need to take a good look at the facts though. This is covered in “Robots and employment: evidence from Italy” written by Davide Dottori and published in the Bank of Italy’s Questioni di Economia e Finanza.

The author explains that the research estimates the effects of the increasing use of robots on employment in Italy. This is an important objective because our country is the second highest user of robots in the EU, after Germany. The author explains that it is also a complex objective to achieve, as the effects of robotisation “are uncertain, as robots can both substitute and complement human labour”.

In order to try to understand the situation, Dottori conducted analysis at both a local labour market level and using micro-data from an administrative source, ranging from the early 1990s until 2016.

The author’s findings indicate that there does not appear to be any statistically significant negative effects on the increased use of robots on overall employment at a local level or on the average employment and wages of incumbent workers in manufacturing at an individual level. Robotisation may have contributed, however, to the cross-sector reallocation of new workers, by increasing the share of the tertiary sector.

In other words, with the use of statistical instruments, Dottori’s research indicates that the introduction of robots to the Italian manufacturing industry has contributed to a kind of transformation in factory work, that has probably not yet finished and that forces a change in production methods and culture. This is a change that not only affects entrepreneurs and managers but all the players in the production process.

Robots and employment: evidence from Italy

Davide Dottori

Bank of Italy, Questioni di Economia e Finanza (Occasional Papers), no. 572 – July 2020

A survey just published by Bank of Italy helps shed light on one of the most important issues for industrial production

Robots versus man. Automation versus employment. Clashing opposites. The conflict between human labour and machine work is a subject as old as the Industrial Revolution. At the end of the day, the ideologies and the economic and industrial policy settings that have made history were built on this conflict. It is certainly true that the advent of machines (digitalisation and robots today), brought about major changes at work in some way. We need to take a good look at the facts though. This is covered in “Robots and employment: evidence from Italy” written by Davide Dottori and published in the Bank of Italy’s Questioni di Economia e Finanza.

The author explains that the research estimates the effects of the increasing use of robots on employment in Italy. This is an important objective because our country is the second highest user of robots in the EU, after Germany. The author explains that it is also a complex objective to achieve, as the effects of robotisation “are uncertain, as robots can both substitute and complement human labour”.

In order to try to understand the situation, Dottori conducted analysis at both a local labour market level and using micro-data from an administrative source, ranging from the early 1990s until 2016.

The author’s findings indicate that there does not appear to be any statistically significant negative effects on the increased use of robots on overall employment at a local level or on the average employment and wages of incumbent workers in manufacturing at an individual level. Robotisation may have contributed, however, to the cross-sector reallocation of new workers, by increasing the share of the tertiary sector.

In other words, with the use of statistical instruments, Dottori’s research indicates that the introduction of robots to the Italian manufacturing industry has contributed to a kind of transformation in factory work, that has probably not yet finished and that forces a change in production methods and culture. This is a change that not only affects entrepreneurs and managers but all the players in the production process.

Robots and employment: evidence from Italy

Davide Dottori

Bank of Italy, Questioni di Economia e Finanza (Occasional Papers), no. 572 – July 2020