A study by the German Institute for Employment Research (Deutsches Institut für Arbeitsmarkt- und Berufsforschung) shows that Automation is not a job killer. Jobs have even been created since 1970. But the beat’s changing.
There are black painters in every technological revolution in Berlin. This was no different after the invention of the steam engine than it was when computers moved into offices in the 1970s: “Progress makes people unemployed,” was the title of the “Spiegel” magazine at the time.
However, a recent study by the Institute for Employment Research (IAB) shows that since 1976 more new jobs have been created than old ones have been lost. However, these are often new jobs with a different requirement profile. For example, more jobs were created than lost for highly qualified workers in the period under review, which runs until 2017. For the low-skilled, on the other hand, the opposite is true.
Over the past decades, Germany has experienced waves of massive job cuts, for example after the oil price shock at the beginning of the 1980s or the reunification a decade later. Since 2006, however, the development of employment – with the exception of the recession year 2009 – has been positive overall, which the IAB authors Hermann Gartner and Heiko Stüber also attribute to the Hartz reforms.
Since 1993, an average of 9.5 out of 100 jobs per year have been lost, but 9.7 new jobs have been created at the same time. Technological progress can lead to redundancies as well as to new hires – for example when new products are launched on the market or additional jobs only become profitable through machine support.
For example, the triumph of the computer has not accelerated job cuts and has even slowed them down since 2005. Since then, more jobs have been lost than newly created for low-skilled and skilled workers. Among the low-skilled, however, it is noticeable that both the workplace construction and dismantling rates have increased over time. This means that many jobs with a low requirement profile continue to emerge, for example in logistics, but often they also disappear quickly.
Digitization brings security
By sector, hotels and restaurants and business-related services expanded most strongly between 2005 and 2014. Thousands of jobs are lost every year, but more new ones are created. Not surprisingly, the mining, printing and textile industries, as well as the financial sector, have higher mining rates than build-up rates. Jobs in an industry that have been rationalized away by robots are often created by service providers close to the company.
The IAB researchers show that in sectors that have already been more involved with automation and digitization, the dynamics of job creation and reduction are surprisingly below average. The risk of becoming unemployed is also significantly lower in the sectors with an affinity to digitization than, for example, in the construction industry.