Abstract: As digital transformation being accelerated, the widespread adoption of digital technologies has exerted a profound impact on the labor market. This paper conducts an empirical study by making use of China’s 2000-2018 sub-industrial panel data. The findings show that digitalization is gradually weakening the capital bias of technological progress, which has a positive impact on the overall share of labor remuneration, and there exists industry heterogeneity. The digitalization of manufacturing industry has improved labor efficiency, making technological progress being in favor of capital, which results in a reduction in labor demand per unitof output, with a negative impact on the share of labor compensation. The digitalization of the service industry has improved capital efficiency, the labor bias of technological progress is deepened and the positive impact on the share of labor remuneration is increased. From the perspective of the subdivided industries, compared with capital- and technology-intensive manufacturing industries, the negative effect of the digitalization of labor-intensive manufacturing industries on the share of labor remuneration is stronger. The positive effect of digitalization on the share of labor remuneration in technology-intensive service industries is stronger, and the impact on data-intensive service industries is negative.

Key words: digitization, factor bias, industry labor compensation share, spillover effect