Technological and Organizational Change and the Careers of Workers

This paper addresses what happens to workers who hold jobs that disappear due to technological and organizational change (T&O). We show that although T&O reduces firm demand for mainly routine-task based jobs, affected workers face no higher probability of non-employment or lower wage growth than unaffected workers. Rather, firms that adopt T&O play an important active role in curtailing its potentially harmful effects by offering affected workers re-training opportunities to upgrade to more abstract jobs, with the exception of older workers. Overall, our findings paint a more positive picture of T&O’s welfare effects than is commonly suggested. * We gratefully acknowledge funding by Norface’s Welfare State Future program. † Ifo Institute for Economic Research at the University of Munich and CESifo Research Network. Contact information: battisti@ifo.de (Michele Battisti). ‡ University College London (UCL) and Centre for Research and Analysis of Migration (CReAM). Contact information: c.dustmann@ucl.ac.uk (Christian Dustmann), u.schoenberg@ucl.ac.uk (Uta Schömberg).