Regional technological change and the unequal costs of job loss

This paper highlights the relevance of a largely overlooked aspect of technological change: its highly unequal regional distribution and the related consequences for workers in case of job loss. We find strong evidence that the regional exposure to routine-replacing technological change (RRTC) is a major determinant of post-displacement careers. Specifically, routine workers fare well in regions with a rather weak RRTC, but suffer strongly in regions that are most exposed to technological change. Regional and occupational mobility partly serve as adjustment mechanisms, but come at a high cost, particularly for older and low-skilled workers. This paper thus sheds new light on how RRTC affects individual career paths and contributes to rising labour market inequalities both among routine workers and between regions