The impact of automation on employment and its social implications: evidence from Chile

Building on the literature of labor implications from technological disruptions, this paper provides a comprehensive review of recent research carried out regarding the expected effects of automation on employment levels and performs diverse empirical approaches to estimate the effects for an emerging country. To illustrate the impact, the paper presents various empirical approaches to estimate jobs gains and losses using Chile as a case study. Results from the empirical estimates suggest that jobs lost to automation technology currently match the jobs being created, thereby resulting in a negligible overall impact on the labor force. However, the occupations being created require a higher number of highly educated workers. The findings, therefore, indicate potential social exclusion effects, as the most vulnerable groups facing a high risk of losing their jobs are low-skilled, low-income workers. To counteract these effects, active public policies need to be formulated and implemented in order to achieve the potential job gains while mitigating the potential negative effects on vulnerable and disadvantaged groups.