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Half of American jobs are at risk from automation, new study suggests

Written by Nick Wells CNBC

The American workforce is under tremendous pressure, with change coming on multiple fronts. That uncertainty is leading to political and social turbulence, a new research paper suggests.

One in four American jobs are at risk of being shipped overseas in the coming years and about half could be replaced by automation, according to Ball State University’s Center for Business and Economic Research. A new paper titled, “How Vulnerable are American Communities to Automation, Trade, and Urbanization?” combines several recent studies on employment trends to present a stark view of the future job situation for certain parts of the country.

“Some places and people observe robust benefits while others observe primarily costs” from the changes underway, the researchers wrote. “This has important economic, social, and political implications.”

The analysis was based on occupational skills data and job locations from the U.S. Bureau of Labor Statistics and the Census Bureau.

Jobs most at risk of being replaced by automation are often lower-income, the researchers said. The quintile of workers in jobs most at risk of automation made an average of $38,000 a year. Data entry keyers, telemarketers and hand sewers were all in the top 10 of most automatable, and each had average annual wages under $30,000.

Far fewer jobs are at risk of offshoring, the authors wrote, but those at risk are more evenly distributed on the income scale. That’s partly because when a factory is automated, many positions, such as management, survive. Conversely, if a factory’s operations are shipped overseas, all of the jobs leave.

The researchers found little relationship between income and chance of offshoring. Jobs such as computer programmers, actuaries and statisticians were among the most offshorable, the researchers wrote. Those occupations have average annual wages of $80,000 or more.

The authors invite further research and policy-based discussions to address the transformation of the American workforce.

“We do not wish to be alarmist,” the researchers wrote. “Both trade and automation related to economic growth are hallmarks of a vibrant economy. However, the social and political unease that accompanies large shocks with varying distributional inequities felt by workers in different occupations and with different skill levels is real.”