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Automation and the risk of labor market exclusion across Europe

Year: 2025

Type: article

Abstract: Labor market exclusion represents a major concern in several European economies, particularly affecting highly exposed demographic groups. This paper examines the potential effect of automation technologies on the risk of being locked into protracted unemployment or inactivity, using Labour Force Survey data for the European Union 27 countries and the United Kingdom, between 2009 and 2019. Our study employs repeated cross-sections of individual-level data to compute probabilities of exclusion outcomes due to automation adoption, controlling for several individual, macroeconomic, and region-specific characteristics, and for potential selection mechanisms. Findings highlight that, on average, the adoption of new automation technologies is associated with a higher probability of being inactive. This is consistent with the view that automation may exacerbate job insecurity, psychological discouragement, and detachment from job-seeking. This relationship is heterogeneous across demographic groups, with younger individuals being relatively more affected.

Source: Structural Change and Economic Dynamics

DOI: 10.1016/j.strueco.2025.12.014

Authors: Fabio Lamperti, Davide Castellani

Institutions: Università Cattolica del Sacro Cuore, University of Reading

Language: English

Topic: Labor market dynamics and wage inequality

Subfield: Economics and Econometrics

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDGs: Decent work and economic growth, Reduced inequalities, Industry, innovation and infrastructure

Open Access status: hybrid

Estimated APC paid: $3,880