Medium-skilled Labour Research Articles

Does Industrial Intelligence Promote Sustainable Employment?

One of the key driving factors for achieving the goal of sustainable economic development is to ensure decent employment opportunities. This article explores the relationship between industrial intelligence and sustainable development in China from the perspective of employment. Based on interprovincial panel data from 2006 to 2019, using the fixed-effect regression model and mediating-effect regression model, this study empirically tests the impact of industrial intelligence on sustainable employment in China. The following conclusions are drawn: (1) Industrial intelligence has a significant positive impact on the overall scale of employment. Industrial intelligence has promoted the optimization and upgrading of employment skill structure and industrial structure. Industrial intelligence will reduce the employment proportion of low-skilled labor and increase the employment proportion of medium-skilled labor and high-skilled labor. Industrial intelligence significantly reduces the employment share of the manufacturing sector and increases the employment share of the service sector. (2) Industrial intelligence reduces employment levels through capital deepening effects. Industrial intelligence has significantly improved regional labor productivity and significantly improved employment levels through productivity effects. (3) The results of regional heterogeneity show that industrial intelligence has promoted the improvement of employment level and the upgrading of employment structure in the eastern region but has not had a significant positive impact on other regions.

The nexus between industrial robot and employment in China: The effects of technology substitution and technology creation

The widespread application of industrial robots has raised our concerns about employment. Based on the data of Chinese micro-enterprises from 2000 to 2019, we use staggered and continuous DID method to measure the impact of industrial robots on the employment in the enterprise level in China. The result of the analysis shows that, under the combined effects of technology substitution and creation, the use of industrial robots has a significant positive impact on the employment of Chinese enterprises. The substitution effect is mainly in medium skilled labor, while the creation effect happens in high skilled and machine auxiliary positions. The analysis of heterogeneity of industry penetration rate of robot shows that, the creation effect in high skill positions and the substitution effect in low and medium skill positions mostly happen in high penetration rate industries, while the substitution effect in high skill positions and the creation effect in low and medium skill positions mostly happen in low and medium penetration rate industries. This result reveals the internal mechanism of the adjustment of employment structure caused by new technology. Based on this, the relevant suggestions are put forward from unemployment security system, corporate social responsibility, training of technical personnel, etc.

РУШІЇ ТРАНСФОРМАЦІЇ ЕКОСИСТЕМИ ЗАКЛАДІВ ВИЩОЇ ОСВІТИ В ПОСТІНДУСТРІАЛЬНОМУ СУСПІЛЬСТВІ

The exponential nature of technological and product innovation in synergy with digital transformation presents new, breakthrough and often unpredictable opportunities for industrial development. It reshapes the existing economic structure, transforming or disrupting traditional industries, and updating the labor market and workforce requirements. The paper is concerned with the factors that drive changes in modern post-industrial society. It discusses the competition brought about by innovation, consumers' rising expectations regarding value proposition and responsible consumption, and the resulting need for expertise and creativity. The study examines that the shift towards knowledge-intensive and information-based production necessitates workers with new skill sets, displaces routine, low- and often medium-skilled labor, and requires proficiency in digital environments, resulting in challenges in adapting to new working conditions. The company's intellectual potential depends on its human resources, which increases the importance of education, including the implementation of the concept of lifelong learning. The current state strategy aims to activate human development and increase the proportion of human capital in national wealth. Using the methods of observation, analysis, comparison and synthesis the relevance of higher education institutions (HEI) as pivotal actors in the formation of human potential is investigated. The opportunities and means by which HEIs can contribute to human development and training of quality intellectual potential are highlighted.The ways of development of the university as an educational-scientific-innovative complex by creating a flexible and in-demand educational proposal, implementation and transfer of scientific research and innovation, as well as cultural and educational activity, and integrating into the international scientific and educational system are defined. The article emphasizes how the cooperation between universities and stakeholders, including labor market partnerships, the formation of horizontal cluster entities involving the business ecosystem, public authorities, and local government, contribute significantly to innovation transfer and sustainable territorial development.

The race between offshoring and automation in explaining wage polarization

AbstractOffshoring and automation are sources of wage polarization. We reassess these two determinants of wage polarization in a single directed technical change setup that encompasses routine and nonroutine production. We empirically establish the conditional positive relationship between automation and relocations on one side and wage polarization on the other. Theoretically, we show that wage polarization increases with automation and offshoring. In particular, wage polarization in favor of domestic (nonroutine) high(low)-skilled workers is positively affected by an increase in domestic (nonroutine) high(low)-skilled labor quantity and/or absolute productivity. Additionally, it is also positively influenced by a rise in foreign (routine) medium-skilled labor quantity and/or absolute productivity while negatively impacted by an increase in domestic (routine) medium-skilled labor quantity and/or absolute productivity. We show that the effect of offshoring on wage polarization diminishes with the degree of substitutability between routine and nonroutine sectors in the economy, with the share of machines in the production of intermediate goods, and with the scale effect. We quantitatively assess the impact through a thorough data-based calibration exercise, where the numerical results confirmed the theoretical findings.

The policy evaluation of China's carbon emissions trading scheme on firm employment: A channel from industrial automation

The debate between pollution reduction and job creation has been a relevant and practical topic, with ambiguous conclusions and expectations. This paper studies the impact of market-based environmental regulation on enterprise employment, taking the quasi-natural experiment of China's carbon emissions trading scheme (CETS). We develop the two-way fixed effects difference-in-differences method to evaluate the employment effect of the CETS, and use the data of listed companies in the manufacturing industry from 2011 to 2019 to provide evidence from China. We observe robust evidence that the CETS significantly expands the employment scale of cities and enterprises on the premise of achieving emission reductions, and that the employment promotion effect of the CETS on enterprises is driven by the application of robots. The output scale effect and productivity effect of robots promote employment, while the factor substitution effect inhibits employment, and the former is greater than the latter. Furthermore, robot application is complementary to low-skilled labor, but substitutes for medium-skilled labor.

Impact of Industrial Intelligence on Total Factor Productivity

Industrial intelligence is gaining more prominence in the new era of the technical revolution. This paper conducts an empirical test based on the panel data of 30 Chinese provinces (municipalities and autonomous regions) from 2006 to 2017. Firstly, the stochastic frontier analysis developed from the transcendental logarithmic production function is applied to calculate the total factor productivity of 30 provinces in China. The fluctuation of the total factor productivity is employed to reflect the quality of economic development. Secondly, the multilevel mediation model is applied to conduct the empirical test. Then, the robustness and endogeny of the conclusions are tested, and a further discussion is finally made, respectively, for eastern, central and western China. The results show that: (1) Industrial intelligence has a promoting effect on the improvement of total factor productivity. (2) Industrial intelligence can increase the demand for highly skilled labor and reduce the demand for low-skilled labor, but it has no significant impact on the demand for medium-skilled labor. (3) Industrial intelligence influences the improvement of total factor productivity through labor force structure.

Could Job Stability Alter Worker’s Employment Intentions: Micro Evidence from CFPS-2018

This paper develops a micro-perspective indicator of job stability, and by using data from the 2018 Micro China Family Panel Studies (CFPS-2018), it empirically examines the impact of job stability on non-farm employment of urban and rural residents in China. The results showcase: Firstly, job stability is a core factor of labor force participation at present; secondly, based on the heterogeneous exploration of urban-rural household registration differences and skill levels, it is found that job stability promotes non-farm employment more for the rural population than urban population; in the meanwhile, the impact of job stability on non-farm employment is greater for low-skilled labor force than for medium-skilled labor, but for high-skilled labor, the impact is the lowest; Thirdly, this paper proposes policy suggestions for enhancing job stability and workers' employment participation.

Can Artificial Intelligence Boost Employment in Service Industries? Empirical Analysis Based on China

ABSTRACT Based on the provincial panel data of China during 2007–2020, this study examines the temporal and spatial dynamic characteristics of artificial intelligence (AI) development and service industry employment, using the fixed-effect model to analyze the influence mechanism of AI development on service industry employment. We analyzed the regional heterogeneity. The results revealed the following: (i) AI experts a direct and indirect impact on the service industry employment. The direct impact is manifested in the creation effect and substitution effect, while the indirect impact is manifested in the competition effect. These effects exert a positive and significant indigenous impact on the service industry employment: increasing the number of jobs, optimizing the employment structure, and increasing employment income; (ii) Subregional studies demonstrated that the impact of AI development on employment in services has regional heterogeneity, which is conducive to narrowing regional differences in services; (iii) Cross-industry studies reported that AI development has augmented cross-industry inflows of labor and increased job competition for medium-skilled labor. This study is utmost significance to improve the employment policy of China’s service industry, optimize the training system of service talents, promote the upgrading of the service industry, and promote the synchronized development of the regional service industry.

Generative Logic of Digital Capitalism Based on Artificial Intelligence Technology

In the era of digital capitalism, machines and technology have gradually become the main body that dominates workers. Information technology is actually the digital embodiment of mass machine production. It is with the help of ICT and digital technology that digital capitalism realizes the digital transformation of the way capitalism exists and the proliferation of digital capital. The purpose of this paper is to study the generative logic of digital capitalism based on artificial intelligence technology. Compare the production, circulation, consumption of traditional commodities, and the production of digital capital, explore the nature of digital capitalism and the differentiation of digital capitalism in the era of artificial intelligence, analyze the impact of artificial intelligence on labor polarization, and the results show the high-skilled labor force in the eastern region. The ratio to the medium-skilled labor force is 0.086. Take the M enterprise in capitalism as an example, and study the application of artificial intelligence to the energy and power industry to provide value to customers through new products. The new changes in contemporary artificial intelligence capitalism solve the problems in the operation of the original business model, benefiting both customers and enterprises.

Impacts of Fuel Subsidy Rationalization on Sectoral Output and Employment in Malaysia

Large allocations for fuel subsidies have long put the Government of Malaysia’s budget under great strain. Using a computable general equilibrium (CGE) model, this paper evaluates the impact of fuel subsidy rationalization on sectoral output and employment. Employment is classified into occupational categories and skill levels. Fuel subsidies were measured using the disaggregation of prices for petrol, diesel, and other fuel products. Findings show that removing fuel subsidies would hit economic performance through high input costs, specifically for industries closely attached to the petroleum refinery sector. The manufacturing sector has the largest reduction in output and employment. Nevertheless, high- and medium-skilled labor forces experience increased demand. To increase economic efficiency, the savings from the removal of fuel subsidies should be put toward policies such as sales tax reduction. This study provides useful information for policy makers in evaluating or updating current subsidy policies to reduce economic losses.

Preference shifts and wage inequality

This paper analyzes how preference shifts affect wage inequality. We take the Cobb–Douglas preference, the Dixit-Stiglitz preference and the quasi-linear preference into account, and find that there exists preference-driven wage inequality. In the two-type labor (i.e. skilled labor and unskilled labor) models, when the preferences of consumers for skilled products are strengthened, wage inequality will be widened (resp. narrowed down) if there is a relatively low (resp. high) capital intensity in the unskilled sector. We also build a three-type labor (i.e. high-skilled labor, medium-skilled labor, and unskilled labor) model and a model with a non-tradable unskilled sector to strengthen the explanatory power. The role of preferences shifts in changing wage inequality is overlooked by the existing literature.

Global Value Chains and Innovation Systems: Exploring the Inter-relations

Advances in transportation sector have shrunk the world in a matter of few hours while the inventions in information and communication technologies is giving time a miss. These together have transformed the structure of world production process. The nations are increasingly concerned about entering the global value chains (GVC) and subsequently to upgrade into higher value-added activities, largely being determined by the structure of their innovation systems (IS). Therefore, an attempt is made to examine the relationship between participation in Global value chains (GVC) and Innovation Systems (IS) of different developed, Asian and developing countries depicting different stages of development. For the purpose, seemingly unrelated regression equation model is estimated for the manufacturing industries and it was found that in the initial stages of development, low-skilled labour, medium skilled labour, process innovation and price level have significant impact on participation in global value chains (GVC) followed by the role of skilled labour and innovations in the advanced stages of development. It was also found that for building innovation systems (IS), the role of high-skilled labour predominates in the initial stages. However, in the later stages, participation in GVC with backward linkages also has a positive impact on building their innovation value systems (IS). Specifically for South Korea with proximity in high technology intensive industries, the impact of high skilled labour, product and process innovation are significant in determining global value chain participation while the high-skilled labour and backward linkages played important role for building its innovation systems (IS). For India’s low-technology intensive industries, low skilled labour and price level have significant impact on its participation in global value chains whereas human capital have positive impact on its innovation systems (IS).

The impact of imported intermediate inputs on the skill structure of labor demand

As global value chains (GVCs) are expanding worldwide, two notable consequences have been documented during recent decades: the increased use of imported inputs for production and the rising demand for high-skilled labor relative to that for low-skilled labor. This paper aims to answer the question of how imported intermediate inputs affect the skill structure of labor demand. The traditional indicator of imported inputs for production has become unreliable with the development of GVCs. Based on the data from input-output tables, this paper uses the foreign value-added (FV) share to measure the reliance on imported inputs for production. Furthermore, the FV share is divided into different sourcing origins to estimate the responses of labor demand to the imported inputs sourced from different origins. The results confirm that the FV share reduces the cost shares of all skill levels of domestic labor. Specifically, the FV share contributes more to the decrease in the demand for medium-skilled labor. Moreover, the FV originating from advanced and developing countries exerts different effects on the demand for domestic labor. Finally, the impact of imported inputs on labor demand varies when different indicators are used.

Employment impacts of the US global value chain participation

ABSTRACT This study applies a new set of comprehensive GVC indices to measure the US GVC participation and examine its impact on US employment from both backward and forward GVC linkage perspectives. Based on data from the World Input-Output Database that covers 1995–2011 across all 35 industries in the US and their value-added trade with 40 other economies, and using Arellano and Bond’s GMM estimator for our dynamic panel data (DPD) model specifications, we find that GVC activities have significant positive impacts on the overall US employment. In our main model specification, each time the GVC participation increases by one point, the overall US employment increases by 0.60 percentage point; however, the benefits are only coming from the backward GVC linkages in their simple form and focused on the medium-skilled labor force. Finally, the general forward GVCs do have a minor significant negative impact on the low-skilled labor segment.

Economic Effects of Regional Energy System Transformations: An Application to the Bavarian Oberland Region

This paper analyzes the effects of different energy transition paths on regional value added and on employment. We extend traditional input-output analysis by taking into account the scarcity of factors of production, and construct a dataset incorporating the regional dimension and specific electricity producing technologies. We find that the three observed districts in the German Oberland region benefit (to varying degrees) from investments towards regional energy transition, both in terms of additional value added and employment. Yet, the positive development comes at the expense of value added and employment in the rest of the country. Moreover, our analysis shows that medium-skilled employment increases most across all scenarios. This finding deserves attention in light of the current shortage of medium-skilled labor in Germany.

Deunionization and job polarization – a macroeconomic model analysis for a small open economy

ABSTRACTDeclining unionization rates and job polarization are two important labor market developments of recent decades. A large body of literature has analyzed these phenomena separately, but little has been done to see whether there is a link between them. We employ a macroeconomic model for a small open economy with a large input–output core to analyze how deunionization may cause job polarization. Our analysis shows that medium-skilled workers are negatively affected by deunionization, mainly as a result of the heterogeneity of the elasticities of substitution between different types of labor. While the elasticities of substitution between high- and medium-skilled labor are relatively low, the elasticities of substitution between medium- and low-skilled are relatively high. As a result, when deunionization leads to increased wage dispersion, we find that demand for low-skilled increases at the expense of medium-skilled labor, thus yielding a more polarized labor market.

Potential roles of export orientation of Cambodia\u2019s agriculture and agro-industry: an application of CGE analysis

For a more diversified export structure and a better distribution of domestic income in Cambodia, agriculture and agro-industry have been specified as export potentials. While empirical impact studies within those sectors have been limited, this paper attempts to assess the impacts of the promising export sectors on domestic economy by applying a computable general equilibrium framework. Results show that the increase in export demand for the selected sectors—food–beverage–tobacco, rubber industry, and agriculture—generate favorably on growth, employment, and household welfare, with the contributions of the former two higher than that of the latter, suggesting that priority should be given to agro-processing exports to increase production chain. The findings indicate that in order for the trading sectors to expand the benefits, productivity growth of low-skilled and medium-skilled labor is crucial. The influence of the selected sectors would be greater when the demand disturbance is combined with supply-side efficiency measure to promote the export orientation.

Cross-border investment expenditure spillovers in European gas infrastructure

We investigate the implications of an integrated vis-à-vis a national perspective regarding investment in natural gas infrastructure. In particular, we analyze cross-border spillovers related to the investment expenditure of five Western European countries. We develop a practical approach to estimate such cross-border investment expenditure spillovers using a multi-regional input-output model. We find that international spillovers are generally larger for employment compensation compared to capital compensation and that the spillovers are unevenly distributed among the countries and the types of labor. Both high-skilled and medium-skilled labor is impacted most in the country where the investments take place, whereas low-skilled labor is mostly generated outside the EU. We argue that an integrated European gas infrastructure investment policy is to be recommended.

Accessing the Impact of Information and Communication Technology (ICT) On the Performance of Banks in Ghana: A Case Study of Ghana Commercial Bank Limited

The study sought to examine the impact of Information and Communication Technology (ICT) on the performance of Ghanaian banks with a case study at Ghana Commercial Bank Limited. Information and Communication Technology (ICT) is at the centre of this global change curve. The application of ICT concepts, techniques, policies and implementation strategies to banking services has become a subject of fundamental importance and concerns to all banks and indeed a prerequisite for local and global competitiveness. The main objectives of the study were to assess the impact of ICT on the financial performance of Ghana Commercial Bank Limited (GCB), to find the contribution of ICT based products to customer satisfaction, to examine how ICT has helped reduce operational cost of GCB and to determine the effect of information technology on the liquidity of GCB. Qualitative data was collected using purposive sampling technique. SPSS was used in the descriptive analysis of one-hundred (100) administered interview guide and open-ended questionnaires. The study revealed that ICT Capital has accelerated growth in the bank. Also, ICT facilitated the absorption of high and medium skilled labour. This has a positive effect on the labour output at the bank. The study findings revealed that the bank's use of ICT also enabled the bank to offer a broad variety of services to customers, coordinate branch activities, and meet up with changes in government regulations and policies. The study observed by concluding that the bank's use of ICT has had an impact on the performance of the bank by way of increasing the bank profitability and also reducing the operational cost of the bank.

The Impact of Medium‐Skilled Immigration: A General Equilibrium Approach

This paper analyses the impact of the skill composition of migration flows on the host country’s labour market in a specific-factors-two-sector model with heterogeneous labour (low-, medium-, and high-skilled). We assume price-setting behaviour in both manufacturing and services sectors. The low- and medium-skilled labour markets are characterized by frictions due to wage bargaining. Moreover, we assume bumping down of unemployed medium-skilled workers into low-skilled service jobs whereas endogenous benefits create an interdependency between the two bargaining processes. Particular attention is paid to medium-skilled migration which enables us to augment the literature by replicating important stylized facts regarding medium skills, such as: i) the interaction between immigration, low-skilled unemployment and medium-skilled over-qualification, ii) the polarization effect where both lowand high-skilled wages increase relative to the medium-skilled. The model is calibrated using German data. The key findings are: (i) a perfectly balanced migration has a neutral impact on the receiving economy due to international capital flows; (ii) immigration of medium-skilled labour together with some high-skilled labour lowers the low-skilled unemployment rate and has a positive effect on output per capita; (iii) migration of only medium-skilled labour has a neutral GDP per capita effect.