A Review of the Impact of Artificial Intelligence on the Labour Market

• Hongjie Chen

  Author

• Zhenwei Tang

  Author

This research paper reviews the three mechanisms through which artificial intelligence affects the labour market: substitution, creation, and augmentation. Unlike the previous wave of automation, artificial intelligence can perform both manual routine operations and cognitive tasks that require knowledge, thereby expanding its effects on employment. The paper provides evidence that AI can substitute codifiable tasks, create jobs in AI and the digital economy, and increase employee productivity through human-machine cooperation. Nevertheless, these AI effects are not equally distributed. Changes in skills demand due to the introduction of artificial intelligence manifest as increased value placed on skills such as digital literacy, data processing and analysis, problem-solving across disciplines, and lifelong learning, while routine jobs and entry-level positions become more vulnerable. Moreover, changes in employment expectations due to AI affect students and young workers, generating both anxiety and increased motivation for skill development. Previous studies show that AI changes tasks rather than occupations, but differ in their assessments of its employment effects.

• JAESD000026.pdf