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The Employment Impact of Emerging Digital Technologies

Author

Listed:
  • Ekaterina Prytkova
  • Fabien Petit
  • Deyu Li
  • Sugat Chaturvedi
  • Tommaso Ciarli

Abstract

This paper measures the exposure of industries and occupations to a broad set of emerging digital technologies and estimates their impact on European employment. Using a novel approach that leverages sentence transformers, we calculate exposure scores based on the semantic similarity between patents and international standard classifications, creating the open–access ‘TechXposure’ database. Through a shift–share design, we instrument regional exposure to estimate the effects of these technologies on employment across European regions. We find a net positive impact, with growth in low- and high-skilled employment at the expense of middle-skilled jobs, suggesting ongoing job polarization. At the technology level, we observe significant heterogeneity: robots and machine learning negatively impact employment (except for high-skilled workers), while workflow management and information processing systems have positive effects. Our results suggest that focusing narrowly on specific technologies like AI and robots may overlook broader positive employment impacts stemming from complementarities among diverse digital technologies.

Suggested Citation

  • Ekaterina Prytkova & Fabien Petit & Deyu Li & Sugat Chaturvedi & Tommaso Ciarli, 2024. "The Employment Impact of Emerging Digital Technologies," CESifo Working Paper Series 10955, CESifo.
  • Handle: RePEc:ces:ceswps:_10955
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    References listed on IDEAS

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    1. Mauro Caselli & Edwin Fourrier-Nicolai & Andrea Fracasso & Sergio Scicchitano, 2024. "Digital Technologies and Firms’ Employment and Training," CESifo Working Paper Series 11056, CESifo.

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    More about this item

    Keywords

    occupation exposure; industry exposure; text as data; natural language processing; sentence transformers; emerging digital technologies; automation; employment;
    All these keywords.

    JEL classification:

    • C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Microeconomic Data; Data Access
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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