Academic Literature

Future of Work – Computerization of white collar jobs

For centuries, advances in labor-saving technology have been met with fear that such technology will eliminate jobs. In the computer era, seminal work by Autor, Levy, and Murnane (2003) clarified that certain jobs are most at risk from technology, in particular so-called routine jobs which are made up of tasks most easily substituted for by computers. As Acemoglu and Autor (2011) show, these jobs neatly correspond to occupations that have experienced employment and wage declines in recent decades—in particular sales, office and administrative support (OAS), production, and operators. Projecting forward, headline- grabbing articles such as Frey and Osborne (2015) have predicted that 47 percent of all jobs could become automated in coming decades, contributing to popular anxiety and calls for preemptive policies such as universal basic income to combat technological unemployment. Although recent work by Acemoglu and Restrepo (2017) on the effect of industrial robots suggests these fears are warranted in manufacturing, little is known about how firms and local labor markets adjust in response to the computerization of white-collar jobs.

In this paper, we investigate the role of technological adoption in a large class of routine jobs: office and administrative support (OAS) occupations. From a peak of over 16 percent of all employment in 1980, the OAS employment share has steadily fallen each year to its current level of below 13 percent. This nonetheless represents a larger share of employment than does manufacturing. At the same time, these jobs have become increasingly reliant on personal computers; for instance, according to O*NET 86% of administrative assistants report using e-mail every day.

Using online job postings from 2007 and 2010-2016 for office and administrative support (OAS) jobs, we show that when firms adopt new software at the job-title level they increase the skills required of job applicants. Furthermore, firms change the task content of such jobs, broadening them to include tasks associated with higher-skill office functions. We aggregate these patterns to the local labor-market level, instrumenting for technology adoption with national measures.

We find that a 1 standard deviation increase in OAS technology usages reduces employment in OAS occupations by about 1 percentage point and increases wages for college graduates in OAS jobs by over 3 percent. We find negative wage spillovers, with wages falling for both workers with no college experience and college graduates. These losses are in part driven by high-skill office occupations. These results are consistent with technological adoption inducing a realignment in task assignment across occupations, lending office support occupations to become higher skill and hence less at risk from further automation. In addition, we find that total employment and wages per population increase with technological adoption, indicating average gains from computerization that are unequally distributed across the labor market.

Chosen excerpts by Job Market Monitor. Read the whole story at “Computerization of White Collar Jobs” by Marcus Dillender and Eliza C. Forsythe

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