Technological developments are leading to new demands from employers regarding the skills that they expect of their workforce. Simultaneously, there has been a notable decline in manufacturing jobs in the UK. Using data at a local authority level, this paper shows that industrial robot technology, an empirical proxy for automation, has had a significant and negative effect on employment across England and Wales. This effect is found to be driven by increased use of industrial robot technology in the transportation manufacturing industry and no evidence is found of offsetting effects at the aggregate level. This evidence is bolstered by the addition of controls and an instrumental variables strategy is used to reduce endogeneity concerns.
Anil Prashar is an MPhil Economics Student and has been researching the impact of automation on the UK labour market under the supervision of Dr. Carl Frey and Dr. Abi Adams