Robotics technology and firm-level employment adjustment in Japan

Bin Ni, Ayako Obashi

Research output: Contribution to journalArticlepeer-review

19 Citations (Scopus)

Abstract

Unlike studies that analyze the impact of robotics technology on overall employment at the industry or firm level, this study investigated cross-division employment adjustment within a firm in an industry with greater diffusion and penetration of robotics technology. By examining changes in the composition of employment, we measured job creation and destruction at the division level and explored whether robotics technology, as a leading example of automation, not only displaces workers but also introduces new jobs in favor of labor. We made use of unique, division-level employment data for Japan's manufacturing firms, together with industry-level data on the installation of industrial robots. We found that industry-level adoption of robots positively affects the firm-level job creation rate and the job destruction rate. Because the magnitude of the impact is larger for job destruction, robot adoption has an overall negative impact on firms’ net employment growth. Our findings suggest that the labor displacement effect of robotics technology and the emergence of new jobs due to technological change coexist even at the firm level.

Original languageEnglish
Article number101054
JournalJapan and The World Economy
Volume57
DOIs
Publication statusPublished - 2021 Mar
Externally publishedYes

Keywords

  • Industrial robots
  • Job creation and destruction
  • Within-firm labor dynamics

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics
  • Political Science and International Relations

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