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The Greener, the Higher: Labor Demand of Automotive Firms during the Green Transformation

Author

Listed:
  • Thomas Fackler
  • Oliver Falck
  • Moritz Goldbeck
  • Fabian Hans
  • Annina Hering

Abstract

We investigate differences in labor demand between German automotive firms specializing in green propulsion technology and those with a focus on combustion engines. To this end, we introduce a firm-level labor demand index based on the near-universe of online job postings and firms’ patent portfolios. Workforce adjustments are a crucial dimension of technology-related structural change, and labor demand as a highly reactive decision parameter is an ideal measure to detect employment adjustments. Our index enables us to distinguish labor demand by firms’ greenness in real-time, a notable advantage over survey or administrative data. In a difference-in-differences setup, we exploit the poly-crisis triggered by unexpected escalations of trade conflicts and sustained by consequences of the pandemic and the war in Ukraine. We find green firms’ labor demand is significantly and persistently higher than before the outbreak of the poly-crisis, by 34 to 50 percentage points compared to firms with a focus on combustion technology. This gap widens over time and is not driven by unobserved firm heterogeneity. Green firms systematically adjust labor demand towards production and information technology jobs.

Suggested Citation

  • Thomas Fackler & Oliver Falck & Moritz Goldbeck & Fabian Hans & Annina Hering, 2024. "The Greener, the Higher: Labor Demand of Automotive Firms during the Green Transformation," CESifo Working Paper Series 11160, CESifo.
    • Handle: RePEc:ces:ceswps:_11160
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    References listed on IDEAS

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    1. Janser, Markus, 2018. "The greening of jobs in Germany : First evidence from a text mining based index and employment register data," IAB-Discussion Paper 201814, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    2. Bohnsack, René & Pinkse, Jonatan & Kolk, Ans, 2014. "Business models for sustainable technologies: Exploring business model evolution in the case of electric vehicles," Research Policy, Elsevier, vol. 43(2), pages 284-300.
    3. David Popp, 2019. "Environmental Policy and Innovation: A Decade of Research," NBER Working Papers 25631, National Bureau of Economic Research, Inc.
    4. David Popp, 2019. "Environmental policy and innovation: a decade of research," CESifo Working Paper Series 7544, CESifo.
    5. Skeete, Jean-Paul, 2017. "Examining the role of policy design and policy interaction in EU automotive emissions performance gaps," Energy Policy, Elsevier, vol. 104(C), pages 373-381.
    6. Popp, David, 2019. "Environmental Policy and Innovation: A Decade of Research," International Review of Environmental and Resource Economics, now publishers, vol. 13(3-4), pages 265-337, September.
    7. Hamermesh, Daniel S, 1989. "Labor Demand and the Structure of Adjustment Costs," American Economic Review, American Economic Association, vol. 79(4), pages 674-689, September.
    8. Thomas Puls & Werner Olle & Heike Proff & Oliver Falck & Nina Czernich & Johannes Koenen & Florian Herrmann & Wolfgang Beinhauer & Stefan Reindl & Alexander Wottge & Roman Zitzelsberger & Ilka Horstme, 2021. "Strukturwandel in der Automobilindustrie – wirkt die Pandemie als Beschleuniger?," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 74(05), pages 03-35, May.
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    More about this item

    Keywords

    low carbon technology; firm employment decisions; sustainability; disruptive innovation;
    All these keywords.

    JEL classification:

    • C55 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Large Data Sets: Modeling and Analysis
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • M51 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Firm Employment Decisions; Promotions
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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