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Workplace automation has 'sizeable negative impact' on pay gap

The introduction of robots into the workplace has had a “sizeable” negative impact on the gender pay gap in Europe, a new paper has found.

modern robotic lab 780 x 440
Workplace automation has been increasing in Europe

For every 10 per cent increase in the number of robots in the workplace, researchers found a 1.8 per cent increase in the conditional pay gap between male and female employees, though both men and women did see their pay increase overall as a result of automation.

The affect upon the pay gap was particularly acute in what the researchers described as ‘outsourcing destination countries’, where gender inequality was already more marked in the workplace. ‘Outsourcing origin countries’ – mostly Western European nations – did not see a marked increase in the pay gap relative to automation, however.

The findings were revealed in the paper Robots and the Gender Pay Gap in Europe, co-authored by Dr Cevat Giray Aksoy, of King’s College London and the European Bank for Reconstruction and Development, and Dr Berkay Ozcan and Julia Philipp, both from the London School of Economics.

Dr Aksoy said: “At a time when policymakers are putting increased efforts into tackling gender gaps in the labour market, our evidence is important.

“Our results suggest that governments not only need to ensure that education and vocational training systems provide people with the right skills demanded in the future, but also need to pay attention to distributional issues. They need to increase efforts to make sure that women and men are equally equipped with the skills most relevant for future employability.”

The researchers found that men were more likely to be present in roles that were higher-skilled and higher in the occupational hierarchy which, combined with automation, exacerbated the existing pay gap.

Researchers gathered data on workplace automation between 2006-2014 from 20 European countries and 28 million observations. They examined how changes in the numbers of robots per worker affected the gender pay gap in the monthly earnings of workers in manufacturing and a few other selected sectors.

The data was drawn from the International Federation of Robotics, the EU Structure of Earnings Survey, the EU KLEMS database, and the EU Labour Force Survey, and included: Belgium, Bulgaria, the Czech Republic, Estonia, Finland, France, Germany, Greece, Hungary, Italy, Latvia, Lithuania, the Netherlands, Poland, Portugal, Romania, Slovakia, Spain, Sweden, and the UK.

Our results suggest that governments not only need to ensure that education and vocational training systems provide people with the right skills demanded in the future, but also need to pay attention to distributional issues– Dr Cevat Giray Aksoy

In this story

Cevat Giray Aksoy

Cevat Giray Aksoy

Lecturer in Economics