Location via proxy:   [ UP ]  
[Report a bug]   [Manage cookies]                
IDEAS home Printed from https://ideas.repec.org/a/cdh/commen/499.html
   My bibliography  Save this article

Risk and Readiness: The Impact of Automation on Provincial Labour Markets

Author

Listed:
  • Rosalie Wyonch

    (C.D. Howe Institute)

Abstract

The process of technological progress is one of creative destruction, where some occupations, skills, products and firms become obsolete and are replaced by technologically superior alternatives. This process, facilitated by trade, improves overall economic growth and raises living standards in the long run. In the short run, however, it risks igniting economic and political tensions as some businesses fail and some people lose their jobs. At the same time, new jobs are created and the skills required to perform others might change dramatically. Given historical trends of employment, it seems unlikely that all occupations that are highly susceptible to automation will be replaced by smart machines over the next few years. As the demand for skills in the labour market continues to grow, however, there is room for public policy to moderate the effect of technological change on the labour market in a number of ways. Each province faces slightly different challenges when developing policy to confront a technologically advanced and uncertain future. Some provinces, with more economic diversification or a concentration of workers in areas that are not very susceptible to automation, appear to be better situated for technological change than others. In developing policies to facilitate the transition to a high-tech future, provinces that face a higher risk of labour market disruption might require a broad-based approach, while those facing a lower risk of disruption might be able leverage existing policies and expand educational or unemployment support where necessary. Differences in the composition of employment and skills levels across the country highlight priority areas that provincial governments should consider in developing education and employment policy responses to adapt to current and future technological change. Disruption as a result of technological change is not a uniform process, so the policies to tackle it similarly should be not be uniform, but should take into account each region’s strengths and weaknesses.

Suggested Citation

  • Rosalie Wyonch, 2018. "Risk and Readiness: The Impact of Automation on Provincial Labour Markets," C.D. Howe Institute Commentary, C.D. Howe Institute, issue 499, January.
    • Handle: RePEc:cdh:commen:499
    as

    Download full text from publisher

    File URL: https://www.cdhowe.org/sites/default/files/attachments/research_papers/mixed/Jan%2015%20Comm%20499%20Final_0.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Peter Howitt, 2015. "Mushrooms and Yeast: The Implications of Technological Progress for Canada's Economic Growth," C.D. Howe Institute Commentary, C.D. Howe Institute, issue 433, September.
    2. Daron Acemoglu & Pascual Restrepo, 2016. "The Race Between Machine and Man: Implications of Technology for Growth, Factor Shares and Employment," NBER Working Papers 22252, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Matthias Oschinski & Rosalie Wyonch, 2017. "Future Shock? The Impact of Automation on Canada’s Labour Market," C.D. Howe Institute Commentary, C.D. Howe Institute, issue 472, March.
    2. Loebbing, Jonas, 2018. "An Elementary Theory of Endogenous Technical Change and Wage Inequality," VfS Annual Conference 2018 (Freiburg, Breisgau): Digital Economy 181603, Verein für Socialpolitik / German Economic Association.
    3. Kariem Soliman, 2021. "Are Industrial Robots a new GPT? A Panel Study of Nine European Countries with Capital and Quality-adjusted Industrial Robots as Drivers of Labour Productivity Growth," EIIW Discussion paper disbei307, Universitätsbibliothek Wuppertal, University Library.
    4. Dario Cords & Klaus Prettner, 2022. "Technological unemployment revisited: automation in a search and matching framework [The future of work: meeting the global challenges of demographic change and automation]," Oxford Economic Papers, Oxford University Press, vol. 74(1), pages 115-135.
    5. Anton Korinek & Joseph E. Stiglitz, 2018. "Artificial Intelligence and Its Implications for Income Distribution and Unemployment," NBER Chapters, in: The Economics of Artificial Intelligence: An Agenda, pages 349-390, National Bureau of Economic Research, Inc.
    6. German Gutierrez, 2018. "Investigating Global Labor and Pro t Shares," 2018 Meeting Papers 165, Society for Economic Dynamics.
    7. Gabriele Ciminelli & Romain Duval & Davide Furceri, 2022. "Employment Protection Deregulation and Labor Shares in Advanced Economies," The Review of Economics and Statistics, MIT Press, vol. 104(6), pages 1174-1190, November.
    8. Gregory Casey & Ryo Horii, 2019. "A Multi-factor Uzawa Growth Theorem and Endogenous Capital-Augmenting Technological Change," ISER Discussion Paper 1051, Institute of Social and Economic Research, Osaka University.
    9. Lankisch, Clemens & Prettner, Klaus & Prskawetz, Alexia, 2019. "How can robots affect wage inequality?," Economic Modelling, Elsevier, vol. 81(C), pages 161-169.
    10. Tilman Santarius & Johanna Pohl & Steffen Lange, 2020. "Digitalization and the Decoupling Debate: Can ICT Help to Reduce Environmental Impacts While the Economy Keeps Growing?," Sustainability, MDPI, vol. 12(18), pages 1-20, September.
    11. Daron Acemoglu & Pascual Restrepo, 2020. "Robots and Jobs: Evidence from US Labor Markets," Journal of Political Economy, University of Chicago Press, vol. 128(6), pages 2188-2244.
    12. Poloz, Stephen S., 2021. "Technological progress and monetary policy: Managing the fourth industrial revolution," Journal of International Money and Finance, Elsevier, vol. 114(C).
    13. Fran Stewart & Kathryn Kelley, 2020. "Connecting Hands and Heads: Retooling Engineering Technology for the “Smart†Manufacturing Workplace," Economic Development Quarterly, , vol. 34(1), pages 31-45, February.
    14. Ajay Agrawal & Joshua Gans & Avi Goldfarb, 2018. "Prediction, Judgment, and Complexity: A Theory of Decision-Making and Artificial Intelligence," NBER Chapters, in: The Economics of Artificial Intelligence: An Agenda, pages 89-110, National Bureau of Economic Research, Inc.
    15. Rod Tyers & Yixiao Zhou, 2023. "Automation and inequality with taxes and transfers," Scottish Journal of Political Economy, Scottish Economic Society, vol. 70(1), pages 68-100, February.
    16. Efraim Benmelech & Nittai K. Bergman & Hyunseob Kim, 2022. "Strong Employers and Weak Employees: How Does Employer Concentration Affect Wages?," Journal of Human Resources, University of Wisconsin Press, vol. 57(S), pages 200-250.
    17. repec:hal:spmain:info:hdl:2441/7n49nkmngd8448a5ts5gt5ade0 is not listed on IDEAS
    18. Matthias Firgo & Peter Mayerhofer & Michael Peneder & Philipp Piribauer & Peter Reschenhofer, 2018. "Beschäftigungseffekte der Digitalisierung in den Bundesländern sowie in Stadt und Land," WIFO Studies, WIFO, number 61633, January.
    19. Gaetano Basso & Giovanni Peri & Ahmed S. Rahman, 2020. "Computerization and immigration: Theory and evidence from the United States," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 53(4), pages 1457-1494, November.
    20. Hernando Zuleta & Andrés Zambrano, 2018. "Neutral or factor saving innovations?," Documentos CEDE 17134, Universidad de los Andes, Facultad de Economía, CEDE.
    21. Davide Furceri & Prakash Loungani & Jonathan D. Ostry, 2019. "The Aggregate and Distributional Effects of Financial Globalization: Evidence from Macro and Sectoral Data," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 51(S1), pages 163-198, December.

    More about this item

    Keywords

    Education; Skills and Labour Market; Employment and Employment Policies;
    All these keywords.

    JEL classification:

    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy
    • J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cdh:commen:499. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Kristine Gray (email available below). General contact details of provider: https://edirc.repec.org/data/cdhowca.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.