Researchers find automation boosts employment at UK manufacturers

22 January 2026  

Employment before and after adopting industrial robots. The graph compares manufacturing plants that adopt industrial robots to those that do not, and shows the percentage change in employment. Before the robots were installed, the groups had similar employment levels, but after adopting robots, there is a sizable growth in the plants which adopted them, compared to those that did not, suggesting that the automation technology drove an increased demand for workers. Source: LSE

A team of UK researchers has analysed data from almost 27,000 UK manufacturing sites and found that factories that adopt industrial robots for the first time expand their workforces by around 8% in the four years after installation, while those that adopt CNC machines increase employment by roughly 6% over the same period.

The researchers, from the London School of Economics’ Centre for Economic Performance, also found that the gains appear quickly and persist. “In plain terms,” they say, “productivity effects dominate displacement at the firm level.”

The researchers found that robot and CNC use is rising and is concentrated in large plants. Between 2014 and 2023, the proportion of plants using robots doubled from about 4% to 8%, while between 2005 and 2023, the proportion of production plants using CNCs rose from about 47% to 56%.

Because robots are more common in large sites, the share of workers employed at robot‑using plants grew faster, from roughly 14% to more than 27%.

Scaling up CNCs delivers even bigger gains – and some reorganisation of work. When plants that are already using CNCs add more machines, employment rises by 9% over four years and keeps trending up. At the same time, the ratio of workers in manufacturing production to those employed in engineering, design and support, falls gradually (by around 8% over six years).

These results are consistent with firms learning how to make the most of automation technologies over time. When experienced firms expand their use of a new technology they are more likely to successfully reorganise their production processes, hence experiencing productivity gains which raise their total employment, but also change the mix of workers that they employ.

The researchers – Aniket Baksy, Daniel Chandler and Peter Lambert – see no evidence that more automated firms are taking business away from others in a way that would offset the firm‑level gains. If anything, employment by competitors’ in the same industry tends to rise after a peer adopts CNCs or robots, and industry‑level “automation waves” are associated with positive or neutral changes in total industry jobs after four years.

The researchers say that their findings align with other recent studies into robots and their impact on labour. In France, for example, research has found that major firm-level investments in modern manufacturing plants lead to an increase in employment of almost 20% over five years. Another study found that Finnish SMEs receiving technology grants increase their employment by 23%.

The LSE researchers suggest three reasons why job numbers might rise after automation technologies are adopted:

• Elastic demand and lower prices  More efficient plants cut costs, expand output and hire workers. Positive spillovers to peers can arise if overall demand grows or if adopters stimulate complementary activity in the supply chain.
• New and complementary tasks  Automation often frees people from set‑up, material-handling and repetitive machining tasks, shifting activities towards programming, quality, maintenance and customer‑specific developments.
• Learning by doing  The bigger effects when firms expand their CNC capacities are consistent with a learning curve: once processes, skills and supplier links are in place, every additional machine yields more.

Based on their research, the team suggests that manufacturers should treat CNCs and robots as platforms, not one‑off purchases. They should build the complementary capabilities – programming, maintenance, fixture design and workflow integration – that allow them to redeploy people to higher‑value tasks. “Our results suggest the largest returns arrive after you have learned how to use the technology, not on day one,” they say.

For policymakers and industry bodies the priority is diffusion and capability‑building, especially for mid‑sized plants. Support for training in CNC and robot programming and integration, better access to finance for upgrades, and knowledge‑sharing across supply chains, can accelerate the transition from first adoption to effective scale‑up – where the biggest gains appear.

The LSE researchers have published their findings in a paper.

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