IT‐Based Technical Change and Job Instability

Abstract

We investigate the impact of IT diffusion on the stability of employment. We document the evolution of different components of job instability over a panel of 348 cities in France, from the mid‐1970s to the early 2000s. The evidence goes against the view that the diffusion of IT has spurred job instability. Yet, analysing long‐term differences in the occupational structure, we find that IT diffusion has increased the share of high‐skill occupations at the expense of low‐skill occupations. This is consistent with French firms' reliance on their internal labour market to meet the new skill requirements associated with IT diffusion.

Technology and jobs: A systematic literature review

“…In line with that, Biagi and Falk (2017) and Ivus and Boland (2015) did not find any significant effect of ICT on employment in European industries and Canadian regions, respectively. Behaghel and Moschion (2016) did not observe that ICT-diffusion increases the probability of dismissals in French cities. If anything, they provided only weak support of increased job instability for high-school dropouts.…”

“…Among those studies that support the reinstatement effect, twenty-three look at the impact of ICT (Atasoy, 2013;Aubert-Tarby et al, 2018;Autor, 2015;Autor and Dorn, 2013;Autor et al, 2015;Autor et al, 2003;Baddeley, 2008;Balsmeier and Woerter, 2019;Behaghel and Moschion, 2016;Berman et al, 1994;Blanas et al, 2019;Fossen and Sorgner, 2021;Fung, 2006;Gaggl and Wright, 2017;Gallipoli and Makridis, 2018;Ivus and Boland, 2015;Jerbashian, 2019;Kaiser, 2001;Kristal, 2013;Luker and Lyons, 1997;Maurin and Thesmar, 2004;Morrison, 1997;Morrison and Siegel, 2001).…”

“…At the city-level, Behaghel and Moschion (2016) studied the impact of ICT on skill upgrading and job-to-job transitions showing that ICT adoption is associated with an increased demand for skilled labor, but not with higher dismissal rates. Gaggl and Wright (2017) and Ivus and Boland (2015) argued that the impact of ICT on net employment depends on various dimensions.…”