The Implications of Industrial Robots on the European Labour Market

Abstract

As robots and other computer-assisted technologies substitute labour in an increasing number of tasks, there are increasing concerns to how this development will influence employment and wages. In this paper, we analyse the economic contributions of modern, industrial robots which are flexible, versatile and autonomous machines to determine how they affect the labour markets in Europe. The results indicate that the use of robots does influence European labour markets, suggesting that the level of employment is on aggregate level positively affected by robot exposure, which points to a dominating productivity effect. Still, our results suggest that the young and low-skilled labour groups are negatively affected, something that is offset by the positive effects observed for the older labour groups with higher educational attainment. The analysis only point to a limited number of robust and significant effects of robot exposure on wages, but these results suggest that robot exposure has a positive effect on wages. The results are based on the manufacturing sector, as the other sectors until now have been less influenced by industrial robots, and hence our findings may not be applicable for the economy as a whole.