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What Happens to Workers at Firms that Automate?
UnavailablePublisher: Journals Gateway
The Review of Economics and Statistics (2025) 107 (1): 125–141.
Published: 03 January 2025
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We estimate the impact of firm-level automation on individual worker outcomes by combining Dutch microdata with a direct measure of automation expenditures covering all private nonfinancial sector firms. Using a novel difference-in-differences event-study design leveraging lumpy investment, we find that automation increases the probability of incumbent workers separating from their employers. Workers experience a five-year cumulative wage income loss of 9% of one year’s earnings, driven by decreases in days worked. These adverse impacts of automation are larger in smaller firms, and for older and middle-educated workers. By contrast, no such losses are found for firms’ investments in computers.
Includes: Supplementary data