Technology And Jobs Week 4

Question 1

4 ways technology has effected jobs.

Answer 1

1.Substitution-some types of work become extinct, sectors change rapidly or disappear completely
Examples:
Blockbuster>Netflix,
Black cab (used to have to pass ‘the knowledge’ to understand roads)>gps allowed freer entry.
Even skilled/creative roles e.g ChatGPT AI could replace lawyers

2.Compliment effect-allow workers to do job better

3.Change employer-employee relationship
Amazon automatically tracks and fires warehouse workers for productivity issues

4.Can change market boundaries, including labour markets e.g crowd-sourced labour, remote working, off-shoring e.g call centres in India

Question 2

Marxist tradition

And proof?

Answer 2

Technology affects distribution e.g GDP per head may rise but distributed unevenly.

Governance structures aren’t robust enough to allow production surplus gains from technological advancement to improve outcomes for EVERYONE.

e.g Besos gets paid way more than lowest paid worker.

Proof:
Graph shows total profits and wage have stopped rising at a similar rate, profit has increased rapidly while wages slowly.

Question 3

Wacker et al (2020)

Answer 3

Explores how increase in robots changed shape of jobs that vary in intensity.

Question 4

How did they do this?

Answer 4

Did this by categorising 4 task types
manual, analytic, routine, non-routine

Looked at robotisation figures by country (Japan highest (18 per 1000 workers, Korea largest increase (from 3 to 11))

Then looked at changes in employment shares by task types.

Question 5

What did they find for changes in employment shares by task type?

And evaluation?

Answer 5

Employment for routine manual work e.g production line workers fell. I.e most easily replaced by robots

Employment for non-routine analytic work e.g accountants, doctors etc increased.

So, increase in robots causes reduction in routine jobs, however only in high income countries, not emerging economies. (Since wages are higher in those, incentivising substitution to robots)

Question 6

Although the effect only occurred in high income countries, how could emerging economies be indirectly affected?

Answer 6

Reshoring

Adoption of robots in high income countries could bring back production tasks (usually routine manual) that were previously offshored to cheap labour emerging economies.

Question 7

Example of the reshoring and the case

Answer 7

Faber (2020)

Adidas “speed” factories meant production in Asia reduced.

Question 8

Battisti et al (2023)

Answer 8

Looked at what happens to workers with routine-intensive jobs when robots come.

Question 9

What did they find on individual labour following technological change, FOR ALL ROUTINE WORKERS?

And what firms in particular?

And what is their explanation for Wacker’ results

Answer 9

Little effect on employment or earnings.

Positively effected, increases skill level and upgrade to other tasks. Especially prevalent in firms running apprenticeships, as have experience in transitioning workers to new tasks.

The decline in routine jobs shown in Wacker primarily occurred within firms with lower employment growth anyways, suggesting it tech was not the main or only driver.

Question 10

What did they find on individual labour following technological change, FOR ROUTINE WORKERS aged 55-59?

Answer 10

Employment and earnings growth fell.

Little upgrading, no investment in older workers as shorter payback period.

Question 11

Evaluation of Battisti

Answer 11

Done in Germany on 16,000 firms;
Findings reflects their employment rules, industrial norms etc. e.g German and US labour markets different responses to tech change. (Unions/apprenticeships spoken about)

Always therefore a question of validity holistically.

Question 12

Sotelo et al (2022)

Answer 12

Looks at “The Geography of Work”

How jobs differ in big and small cities. (How tech is influencing that)

Question 13

Concentration of graduates in big cities 1970 v 2015

Answer 13

1970- 5% in large cities
2015- 25% in large cities

Increasingly concentrated in large cities.

Question 14

How did they carry out this and why?

Answer 14

Text analysed 7.2m job adverts for key words.

Give understanding of what people are actually doing, beyond just their occupational category. E.g financial analyst in NY may be doing different to financial analyst in Cali.

I.e to accurately see if technology is more present in cities.

Question 15

What were the key words in the text analysis they looked for? (2)

Answer 15

Looked for words relating to…

1.Face to face interaction
2. Technology

Question 16

What did they find? (3) include stats

Answer 16

Biggest cities have the most interactive tasks, more new technologies, and higher specialisation (can increasingly attract skilled workers- external economies of scale). So wages are higher.

30% of interactivity gradient driven by within-occupation differences.(Same category, different job role description)

10% driven by new technology gradient. Technologies e.g python have a steep gradient for jobs requiring a degree

60% by different composition of occupation (e.g more financial analysts in NY than Texas)

Question 17

What else did they find in Wacker

Answer 17

Higher education is not a sufficient bulwark to mitigate impact of robots on jobs.

Question 18

What else did they find in Battesti

Answer 18

More frequent upskilling to workers, in firms part of unions. (As unions actively engage in provision of training opportunities)

Question 19

What else did they find in Sotelo

Answer 19

Working from home has persisted even after COVID.
Could potentially diminish one of key advantages the urban labour markets have, in being in same location as other professionals.

Work-from-home technologies also tend to be adopted first by educated workers in cities. And college educated tend to work in interaction intensive, thus being more suitable to remote work compared to e.g manning a store.

Question 20

How much of the 3 measures explain the difference in wages between small and big cities

Answer 20

1/5 of the 30 log point difference.

Question 21

Technology text analysing findings

Answer 21

Jobs in big cities require specific technology skills.

Shown by jobs requiring a college degree express requirements for “python” and “GIS”

Compared to jobs requiring a high school diploma expressing requirements for Excel and outlook (more simple)

Question 22

Evaluation of Sotelo

Answer 22

Whether these characteristics in big cities will persist.

Question 23

Reasons why the big cities qualities (interactive, technological, specialised) may not persist? (5 points)

Answer 23

1.Work-from home revolution.

2. has persisted even after COVID-19.

3.Emergence of work-from-home technologies reduce the need to be in same location. More occupational mobility.

4. Such technologies tend to be adopted first and more intensely by more educated workers in the large labour markets
5. College educated work more in interaction-intensive, interaction more applicable to remote work e.g communicating online as opposed to manning a physical retail store