Automation and labour market inequalities: a comparison between cities and non-cities

This paper reassesses the displacement effects of automation technologies from an urban perspective by highlighting heterogeneous effects in urban vs non-urban settings. Specifically, the paper argues that automation technologies in the form of robotisation do displace jobs and shrink the labour force, whatever the territorial context considered. However, this displacement effect particularly hits low-skilled workers in non-urban settings which suffer from the substitution pressure of robots and may exit the labour market. In urban contexts, instead, the low-skilled workers displacement effect is offset by reinstatement effects and, more relevantly, a reorientation of occupations towards more skilled, better paid ones, i.e., élite occupations, raising concerns about a widening of inequalities in cities vs non-cities. The paper proves these statements in an analysis of the adoption of robot technologies in Italian cities in the period 2009–2019.