What is the impact of industrial robots on the labour market? A recent study by the Massachusetts Institute of Technology and Boston University found that between 1990 and 2007, for every 1,000 U.S. workers, the U.S. workforce fell 0.2 percent and workers’ wages fell 0.42 percent. That means that for every additional robot in U.S. manufacturing, an average of 3.3 workers will be replaced.
The study, “Robots and Jobs: Evidence from the U.S. Labor Market” (Robots and Jobs: Evidence from us Labor Markets), was conducted by Daron Acemoglu, an economics professor at the Massachusetts Institute of Technology, and Pascual Restrepo, an assistant professor at Boston University. The research paper was published in the economics journal Journal of Political Economy.
The two researchers used 19 industry data collected by the International Federation of Robotics (IFR) to model data from population, employment, business and wages provided by the U.S. Census Bureau, the Bureau of Economic Analysis and the Bureau of Labor Statistics.
Geographical distribution of industrial robots in the United States from 1993 to 2007
They found that the four major manufacturing industries used 70 percent of the U.S. workforce, automotive (38 percent), electronics (15 percent), plastics and chemicals (10 percent) and metal manufacturing (7 percent).
The distribution density of robots varies greatly in geography. Michigan is the most mobile-focused place for robots in the workplace, with Detroit, the state capital, and Lansing, the state capital, and Saginano, an industrial city in the east and central states, the most affected.
Study author Daron Acemoglu found that the most obvious problem with robotics was Detroit. “Whatever happens in the auto industry, the impact on the Detroit area (compared to the rest of the United States) is much greater.”
Industrial robots in the United States and Europe. The number of industrial robots per thousand workers in the United States and Europe.
By horizontal comparison, the researchers also found that robot deployments in the U.S. lag behind those in Europe. Between 1993 and 2007, the proportion of new robots introduced in the United States was close to one robot per 1,000 workers, but in Europe, an additional 1.6 robots per 1,000 workers over the same period.
“Although the United States is a very technologically advanced economy, it lags behind many other advanced economies in terms of industrial robot production, use and innovation,” Acemoglu said.
The study points out that robots have a direct impact on income inequality. In manufacturing, some workers who are replaced by robots don’t have many other good job options. The results show a direct link between the use of robots and industry automation and the decline in incomes of blue-collar workers.
The study provides evidence of the negative impact of robots on employment, but author Daron Acemoglu says their findings do not support the idea that “robots take away all human jobs.”