Canadian Millennials Less Interested in Jobs at Threat from Automation

One of the most widely discussed global labour market issues is the risk that automation poses to the labour force. Workers in many types of jobs may soon be replaced by machines: but will this process be purely destructive, or could it also create enough new jobs to offset losses?

Of course, the threat posed by automation will not come to a head all at once, but rather will take years to unfold. Therefore, automation will carry a varying impact on the current generations, with the brunt of it likely falling on millennials, who have most of their careers ahead of them.

Although the quickening pace of advancements in artificial intelligence seems to leave jobs of almost all types at risk of automation, the occupations at greatest risk are those that are comprised largely of routine tasks easily replicated by machines or software.

Using Indeed job search data, we investigated job seeker interest in occupations at high-risk of automation to determine if millennials are situated any better than previous generations to weather the rise of the machines — and found that Canadian millennials’ occupational interests may help protect them from some potential job losses.

Generational interest in high- and low-risk occupations

To segment jobs by those facing a greater or lesser risk of automation we grouped broad occupational classifications into four categories based on attributes of their primary functions: non-routine cognitive, routine cognitive, non-routine manual, and routine manual. Then, using Indeed’s job seeker activity, specifically clicks to job postings, we can see just how much interest each of these categories is getting from job seekers.

To take the analysis a step further, we parsed these click to job posting data out by the inferred age of the job seeker to compare millennial (ages 20-36 in 2017), Gen Xer (ages 37-52 in 2017) and baby boomer (ages 53-71 in 2017) interest in these different occupational groups.

The chart below breaks down clicks to job postings in our four main categories, by generation of the job seeker. Millennials, followed closely by Gen Xers, demonstrate the most interest in the non-routine cognitive category, which is comprised primarily of occupations that are at low risk of automation.

At the other end of the chart, the difference between generations is even more stark. The largest disparity is between the boomers’ high-level of interest in routine manual jobs and the comparatively tepid attraction displayed by millennials toward the same occupations. Boomers are about 54% more likely to be interested in jobs within this category, which includes many occupations at high risk of automation.

To get a clearer picture of how occupational preferences differ between the generations, it is helpful to view their job search activity segmented out by major occupation categories. The chart below shows how click activity by generation in each occupation varies from the generational breakdown in click activity for all jobs.

At the top of the chart above are the occupations for which millennials have a much greater preference than older generations, and millennials’ higher rates of education are evident in their choices.

Canada’s labour force is becoming more educated — the share of the labour force with a university degree climbed from 18.1% in 2005 to 23.8% in 2015. Millennials are showing greater interest in higher-skilled, and non-routine occupations that are less likely to face replacement by automation. In fact, only three of the 15 occupations preferred by millennials are routine occupations.

In the lower half of the chart are the occupations preferred by boomers and, to some degree, Gen Xers. These are mostly routine, lower-skilled occupations that perhaps face a greater risk from automation.

What may be most concerning for the Canadian labour market is the gap in generational interest in transportation jobs. Canada’s trucking industry already faces a shortage of drivers, and the horizon looks rather bleak as boomers are set to retire in coming years, and millennials seem particularly apathetic to these roles. Perhaps this is one occupation in which an automation-induced decrease in demand for human labour would be welcome.

As automated technology in the labour market progresses in coming years, workers in many different types of occupations will likely see parts or all of their job come under threat of replacement by machines or software.

However, through a combination of their educational background (and perhaps seeing the writing on the wall), millennials are much less keen on occupations at high-risk of automation than other generations — and so are better situated to ride out the disruption that will likely be caused by the coming waves of automation.

This analysis is based on six months of Indeed job seeker activity, from September 2016 to March 2017. Job seeker interest is measured as the volume of clicks to job postings in each occupation group as a share of clicks to all job postings. Indeed job postings are organized into their relevant US Bureau of Labor Statistics’ Standard Occupational Classification (SOC) category. The SOCs are then grouped in the following categories based on their primary job functions: non-routine cognitive, non-routine manual, routine cognitive, and routine manual, as has been done in previous research. Job seeker age is estimated based on resume characteristics and categorized into the relevant generation, using Pew Research Center definitions: millennials (ages 20-36 in 2017), Generation Xers (ages 37-52 in 2017) and baby boomers (ages 53-71 in 2017).