Identifying Factors Reinforcing Robotization: Interactive Forces of Employment, Working Hour and Wage

• Main Authors: Joonmo Cho, Jinha Kim
• Format: Article
• Language: English
• Published: MDPI AG 2018-02-01
• Series: Sustainability
• Subjects: robotization; the triangular relationship of employment–working-hours–wages; employment rigidity; reduction of working hours; seniority-based wage system; labor union
• Online Access: http://www.mdpi.com/2071-1050/10/2/490

Unlike previous studies on robotization approaching the future based on the cutting-edge technologies and adopting a framework where robotization is considered as an exogenous variable, this study considers that robotization occurs endogenously and uses it as a dependent variable for an objective examination of the effect of robotization on the labor market. To this end, a robotization indicator is created based on the actual number of industrial robots currently deployed in workplaces, and a multiple regression analysis is performed using the robotization indicator and labor variables such as employment, working hours, and wage. The results using the multiple regression considering the triangular relationship of employment–working-hours–wages show that job destruction due to robotization is not too remarkable yet that use. Our results show the complementary relation between employment and robotization, but the substituting relation between working hour and robotization. The results also demonstrate the effects of union, the size of the company and the proportion of production workers and simple labor workers etc. These findings indicate that the degree of robotization may vary with many factors of the labor market. Limitations of this study and implications for future research are also discussed.