Automation and inequality within firms: Evidence from the manufacturing sector in South Africa

Rafael de la Vega, Timothy Köhler, Antonio Martins-Neto and Siphelele Ngidi

No wp-2026-61, WIDER Working Paper Series from World Institute for Development Economic Research (UNU-WIDER)

Abstract: This paper investigates the effects of automation on employment dynamics and within-firm earnings inequality in South Africa's formal manufacturing sector. By leveraging matched employer-employee administrative records linked to firm-level import transactions, we find that firms adopting automation are typically on a strong growth trajectory prior to adoption and continue to expand thereafter, particularly in the case of smaller establishments.

Keywords: Automation; Technological change; Structural change; Firms; Inequality; Employment; Wages (search for similar items in EconPapers)
Date: 2026
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