The effect of automation levels on US interstate migration

Abstract

This study investigates the extent to which job process automation, which has resulted in wage inequality and job polarization in the USA and has affected US interstate migration over the past two decades. The level of automation in each state is calculated using data on the degree of automation of each occupation. In particular, this study examines how the difference in the levels among states explains the movement of migrants. The results show that people move to states with more automation in skilled occupations and less automation in unskilled occupations. This finding implies that automation has a complementary (substitution) effect on skilled (unskilled) occupations. The results also show that the former effect is larger and more robust than the latter one. Further analyses use migration flow data classified into several subgroups and find that both skilled and unskilled workers in most occupations move to states with more automation in skilled occupations and less automation in unskilled occupations.