Study: Automation will hurt jobs in rural communities worse than urban centers – Chicago Tribune

With automation threatening to upend half of American jobs in coming years, a new report examined which counties are most at risk of job loss and found that low-income communities already suffering economically are in for the worst of it.

The white paper released Tuesday by Ball State University in Muncie, Ind., measured county vulnerability to job loss from offshoring and automation, based on the types of occupations that previous studies have shown to be particularly at risk and how prevalent those jobs are in the counties.

Automation poses a far greater risk to American jobs than offshoring and has a disproportionately harsh impact on poorer, rural communities. While the risk of losing one's job to trade pressures or overseas labor competition is spread evenly across income and education, the risk of being replaced by automation is highest among people making less than $38,000 a year.

Economists often focus on the long-term benefits of more trade and automation but "the transition period could be extraordinarily nasty," exacerbating existing trends that have driven much of the nation's political and social discontent, said Michael Hicks, director of the Center for Business and Economic Research at Ball State and a co-author of the study.

"It would benefit my profession if we were more honest about the cost of transition the disruption of people's lives, the hollowing out of communities," Hicks said.

Big urban centers with a broad mix of jobs are poised to weather the labor market storm better than small rural communities. For example, in Cook County, 54.5 percent of jobs are at risk of being lost to automation, and 28.7 percent to offshoring, while in Alexander County at the southern tip of the state among several counties along the Ohio River substantially reliant on factories 62 percent of jobs risk being replaced by automation and 26.9 percent lost to offshoring.

None of Illinois' counties are in the top 25 ranking of most at risk from automation or offshoring, but some of its neighbors are. LaGrange County in Indiana, for example, has a 65 percent automation risk and 30 percent offshoring risk; the heavily Amish county, which has many assembly plants, is among seven Indiana counties in the top 25 for offshoring and one of three in the top 25 for automation.

The most at-risk county in the nation is Alaska's Aleutians East Borough, at 67 percent automation risk and 31 percent offshoring risk. Falls Church in Virginia has the lowest automation risk, at 36.4 percent.

DuPage and Lake counties have slightly lower automation risk rates than Cook County while Kane and Will counties are slightly higher. Champaign County has the lowest automation risk in the state, at 51 percent, not unusual for rural college towns where jobs in building and grounds maintenance aren't easily automated, Hicks said.

The study did not evaluate how many jobs will be created as a result of automation and offshoring or calculate the benefits of lower-priced goods, increased productivity and more free time that may come with those labor market changes. But it is likely that many of those replacement jobs and benefits will occur in more heavily populated areas, creating even greater gulfs between urban and rural communities, where people often don't have the means or resources to move to where the opportunities are.

The patterns aren't surprising but they are worrisome, Hicks said. The economic frustration of the past few years occurred during a period of job growth and relatively mild automation disruption compared with what some economists think is coming.

"We think that is evidence that it could get worse before it gets better," Hicks said.

The report urges policy discussions to address the transition period and says local and state policy solutions to shore up jobs have been shortsighted. Many communities, particularly in the Midwest, focus on attracting jobs with tax credits without consideration for whether those jobs will exist long-term or funding skills development without regard for whether those skills will soon be irrelevant, Hicks said.

The jobs most vulnerable to automation include data entry keyers, mathematical science occupations, telemarketers and insurance underwriters, according to the report. The occupations most at risk of offshoring include computer programmers, mechanical drafters, computer and information research scientists and, again, data entry keyers.

The jobs at least risk of being automated or offshored include recreational therapists, emergency management directors, mental health and substance abuse social workers, audiologists, and first-line supervisors of mechanics, installers and repairers.

aelejalderuiz@chicagotribune.com

Twitter @alexiaer

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Study: Automation will hurt jobs in rural communities worse than urban centers - Chicago Tribune