Computerization and skill bifurcation: the role of of task complexity in creating skill gains and losses

Abstract

Does computerization increase or reduce the extent of skills that workers are required to have? Autor, Levy and Murnane (2003) show empirically that adoption of computer-based technologies (CBT) was greater in industries historically intensive in routine tasks, and that computerization increased complex problem-solving and communication activities and reduced routine cognitive and manual activities. We extend this argument and argue that the effects of CBT are neither universal nor uniform, but a bifurcation emerges: occupations that historically (pre-computerization) required low skills and entailed low-complexity tasks do not experience a lot of CBT in their environment, or if they do, they remain low skill (or in extremis become less skilled) occupations, whereas historically high-skill occupations that entailed high complexity see much CBT as well as increases in the skills they require. We test these propositions in a unique dataset that includes measures of the degree of computerization and changes attendant to computerization in the level of seven skills of core employees (content, complex problem-solving, etc.) for a sample of 819 firms in 2000. We link this dataset by core employees' occupation to US occupation-level data on three dimensions of task complexity (with respect to data, people and things) in 1971 (pre-CBT). We find that: (1) higher pre-CBT task complexity is associated with subsequent adoption and intensity of CBT; and (2) for occupations that were historically characterized by complex tasks, CBT affects most skills positively, but for simple tasks, CBT does not affect skills or affects them negatively. We replicate our analyses with the dataset and measures used by Autor, Levy and Murnane (2003) and obtain similar results. Our results shed light on the skill-based technological change and skilling-deskilling debates and suggest that the relationships are contingent in more nuanced ways than the literature has suggested.