The Impact of AI on the Labor Market: Companies Reconsidering their IT Workforce Size

AI and the labor market: "Many companies will question their own large IT staff"

Generative artificial intelligence (AI) is changing the world of work by automating tasks such as software development and data analysis. According to scientists interviewed by the Science Media Center (SMC), the effects of generative AI are likely to affect job profiles with higher educational qualifications and income to a particularly high degree. This may lead some companies to question whether they really need large IT staffs or just a few people who use AI to keep the company’s software running.

However, the effects of generative AI may take years to fully integrate into companies’ processes. This will give everyone involved time to implement adjustments so that layoffs can be avoided. Additionally, the relative lack of IT experts in Germany means that increasing automation in the IT sector will hardly lead to mass unemployment.

AI will likely be used to take over tasks that were previously not or less affected by automation, such as translating, creating texts, graphics, music, and driving vehicles. However, it is not yet clear whether AI will mainly replace or complement tasks. If AI is used as an aid, less skilled workers in particular should benefit.

Jobs that are increasingly in demand during this change are data scientists. However, the wages of university graduates are likely to vary further. Nursing professions, for example, are little influenced by AI.

To cushion the transformation caused by AI, labor market policy should develop scenarios and the government must develop strategies together with trade unions and employers’ associations. AI-supported application programs should comply with scientific standards and only check characteristics that are important for a position.

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