Do robots really destroy jobs? Evidence from Europe

Abstract

While citizen opinion polls reveal that Europeans are concerned about the labour market consequences of technological progress, our understanding of the actual significance of this association is still imperfect. In this article, the authors assess the relationship between robot adoption and employment in Europe. Combining industry-level data on employment by skill type with data on robot adoption and using different sets of fixed-effects techniques, the study finds that robot use is associated with an increase in aggregate employment. Contrary to some previous studies, the authors do not find evidence of robots reducing the share of low-skill workers across Europe. Since the overwhelming majority of industrial robots are used in manufacturing, the findings should not be interpreted outside of the manufacturing context. However, the results still hold when including non-manufacturing sectors and they are robust across a wide range of assumptions and econometric specifications.