2025/09 LEM Working Paper Series

Automation, Firm Size and Skill Groups

Julian Tiedtke
  Keywords
 
Automation, Employment, Firm heterogeneity, Deskilling
  JEL Classifications
 
J230, L250, O330
  Abstract
 
This paper examines the impact of automation investments on employment dynamics and workforce composition using administrative data from Portugal. I exploit the lumpiness of automation imports in a difference-in-differences event study design. My results show that automation creates jobs in small firms but leads to job losses in larger ones. This pattern holds across a wide range of firm types, industries and types of automation technologies. Most importantly, automation favors low-educated, routine-blue-collar workers in routine-intensive jobs over highly skilled workers like STEM professionals. These findings challenge the view of automation as inherently skill-biased
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