Robots and the Labour Market: The Effects of Industrial Robots on Employment and Wage Levels

Abstract

This study reviews academic journal articles and previous qualitative research on manufacturing and logistics to assess how industrial robots influence employment, wages, and the income prospects of unemployed workers. The findings show that robot adoption generally leads to a gradual decline in employment over time, especially for low- and medium-skilled workers. Although many jobs are not eliminated immediately, the tasks within those jobs often become simpler as firms introduce new technologies. This reduces the number of skills required, makes workers more interchangeable, and weakens their bargaining power, which in turn puts downward pressure on wages and limits opportunities for wage growth. The study also notes that firms typically adopt robots to improve productivity and competitiveness, enabling them to keep production sites open and maintain output with fewer employees. However, the negative effects of robots are not uniform and vary considerably across countries and industries, depending on institutional and sectoral conditions. To lessen these adverse consequences, the study recommends strengthening labor unions, encouraging participatory decision-making, and creating clear training and redeployment pathways for affected workers. It also calls for more comparative qualitative research across sectors and institutional contexts.