Executive summary
Introduction
Digitalization: What it is and why it matters
Defning and measuring digitalization
Findings
Implications: Strategies for adjusting
Conclusion41038
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CONTENTS
3Digitalization and the American workforce
EXECUTIVE SUMMARY
O
ver the past half century, wave after wave of digital innovation
has ensured that “digitalization”—the diffusion of digital
technologies into nearly every business and workplace and
pocket—has been remaking the U.S. economy and the world of work.
So rapid are the developments, in fact, that while
the “digitalization of everything” has become
a hallmark of tech’s promise of empowerment,
it has begun to prompt widespread anxiety,
including among workers who worry about their
future in an age of brilliant machines.
And yet, for all of the evidence that big changes
are underway, surprisingly little data exists
to track the spread of digital adoption. In the
absence of such information, the digitalization
trend, as prominent as it is, remains diffuse and
hard to pin down.
Hence this report: Designed to clarify a major
trend, the present assessment provides a detailed
analysis of changes in the digital content of 545
occupations covering 90 percent of the workforce
in all industries since 2001. Along these lines, the
report fnds that:
Though digitalization is an ongoing trend, the
U.S. economy has digitalized rapidly over the
last decade.
The degree and pace of digitalization vary
widely across occupations and industries.
Digitalization is associated with increased
pay for many workers and reduced risk of
automation, but it is also helping to “hollow
out” job creation and wages by favoring
occupations at the high and low ends of
the pay scale while disfavoring those in the
middle.
The extent of digitalization also varies widely
across places and is strongly associated with
variations in regional economic performance.
Digitalization is changing the skills needed
to access economic opportunity while
creating new race- and gender-based access
challenges.
In keeping with these trends, the overall
takeaway here is twofold, as befts a powerful but
ambiguous trend. Digitalization, for one thing, is
vastly expanding the potential of the American
economy, and generating opportunities for
many. However, the construction of an inclusive
labor market as digitalization proceeds won’t
happen by itself. Instead, it will require signifcant
improvements in digital education and training,
both to broaden the high-skill talent pipeline
and ensure that underrepresented groups can
connect to an increasingly digital economy. In
addition, it is going to be important for workers to
get better at being “what we are that computers
aren’t.”
Brookings Metropolitan Policy Program4
Overthepasthalf century, wave after
wave of digital innovation has ensured
that “digitalization”—the diffusion of digital
technologiesinto nearly every business,
workplace, and pocket—continues to remake the
U.S. economy and the world of work.
Nurses work like scientists, using portable vein
fnders for blood tests, while auto mechanics
employ laptops to troubleshoot cars, and
salespeople rely on cloud-based, artifcially
intelligent software agents like Siri and Alexa to
schedule meetings.
So rapid are the developments, in fact, that while
the “digitalization of everything” has become
a hallmark of tech’s promise of individual and
business empowerment, it has also begun to
prompt anxiety, including among workers who
worry about their future in a world of brilliant
machines.1
And yet, for all of that, and despite much evidence
that big changes are underway, surprisingly little
data exist to track the spread of digital adoption
across industries and into workplaces.2 In the
absence of such information, the digitalization
trend, as prominent as it is, remains diffuse and
hard to pin down.
Which is where this report comes in. To help
address the shortage of data on the topic, this
assessment provides a detailed analysis of
changes in the digital content of 545 occupations
covering 90 percent of the workforce in all
industries since 2001.
The latest in a series of analyses from the
Metropolitan Policy Program aimed at helping
leaders understand and manage the disruption
associated with major economic trends, the
report moves initially to defne and state the
importance of “digitalization” and then to
describe a novel method for quantifying the
trend. With the resulting data in hand, the
analysis then reviews a series of trends refecting
the spreading reach of digitalization and the
varied ways it is affecting workers, industries, and
places. Detailed information for states and large
and small metropolitan areas is provided in an
accompanying web-based interactive tool. Finally,
the report discusses implications of the fndings
and suggests ways communities can work with
frms and workers to spread the benefts of
digitalization while mitigating its potentially
harmful effects.
In keeping with this discussion, the report
concludes by stressing the importance of
improving digital education and training, both to
expand the high-skill talent pipeline and ensure
that underrepresented groups can connect to
an increasingly digital economy. In addition, the
discussion notes how important it is becoming for
all workers to cultivate durable “soft” or human
skills as a way to get better at being “what we are
that computers aren’t.”
In the end, the main takeaway is twofold, as befts
a powerful but ambiguous trend. Digitalization is
vastly expanding the potential of the economy,
and generating opportunities for many. However,
the construction of an inclusive labor market as
digitalization proceeds won’t happen by itself.
INTRODUCTION01。