Routine-Biased Technological Change and Hours Worked over the Business Cycle.

Summary Technological change has been biased towards replacing routine labor over the past four decades. We study the implications of those shifts in the task composition of labor demand over the business cycle. We build quarterly time series on hours worked and task premiums from the CPS and assess the e_ects of routine-biased technological change by estimating a VAR model with long-run exclusion and sign restrictions. The decline in total hours worked is driven by routine-biased technology shocks through a decline in routine hours. These shocks appear quantitatively relevant and generate recognizable aggregate uctuations pointing out their relevance to business cycles.