Diffusion of E-Commerce and Retail Job Apocalypse: Evidence from Credit Card Data on Online Spending

Hyunbae Chun, Hailey Hayeon Joo, Jisoo Kang and Yoonsoo Lee ()

No 2020-7, CEI Working Paper Series from Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University

Abstract: The rapid growth of e-commerce is widely blamed for job losses in brick-and-mortar retailers. We construct a unique measure of online spending share based on 30 billion transactions of credit cards in Korea. Using the geographic variation in online spending shares, we examine the causal effect of e-commerce on retail employment at the county level. We find that the rise in online spending share from 2010 to 2015 decreases the county-level offine retail employment by about 172 workers, which represents approximately 3% reduction in average retail employment. We also find that the employment shifts from offine retail to other local businesses, such as restaurants and personal services. However, such effects of employment shift are confined in metropolitan areas and fall far short of offsetting employment losses in non-metropolitan areas. Our finding implies a prospect of Retail Job Apocalypse in certain local labor markets (i.e., non-metropolitan areas), if not everywhere.

Keywords: E-Commerce; Employment; Local Labor Market; Retail; Credit Card (search for similar items in EconPapers)
JEL-codes: J21 L81 R12 (search for similar items in EconPapers)
Pages: 52 pages
Date: 2020-10
New Economics Papers: this item is included in nep-cwa, nep-pay and nep-ure
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Persistent link: https://EconPapers.repec.org/RePEc:hit:hitcei:2020-7

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