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AI may be creating jobs rather than cutting them, ECB says
European Central Bank (ECB) blog post said the rising use of AI by firms in the euro zone may be creating jobs in the near term rather than destroying them.
The claim draws on the ECB’s Survey on the Access to Finance of Enterprises (SAFE), which found firms making significant use of AI are more likely to take on additional staff in the near term.
The blog post, which the authors said did not necessarily reflect the ECB’s views, was written by two ECB staff economists.
It said AI-intensive firms tend, on average, to increase hiring rather than cut jobs.
By contrast, a recent study by Germany’s Ifo Institute found more than a quarter of German firms expect AI to lead to job cuts in the next five years.
🔗 Source: Reuters
🧠 Food for thought
Implications, context, and why it matters.
The motive for using AI shapes hiring outcomes
- Hiring gains do not appear across every company using artificial intelligence. Growth clusters among heavy users.
- Companies with substantial AI use are about 4% more likely to add staff 1.
- Companies that use AI mainly to cut labour costs tend to hire less and lay off more. Only 15% of AI users name labour cost reduction as a reason 1.
- Small companies drive most of the employment change. Large companies so far see a neutral employment effect from AI 1.
A short-term tech boom can come before a long-term labour shift
- The European Central Bank one-year view from its Survey on the Access to Finance of Enterprises, SAFE, differs from the Germany-based Ifo Institute five-year view. The gap comes from different study timelines for AI and employment 1.
- Early adoption often brings an implementation phase that adds jobs to integrate new systems. U.S. data links AI to about 119,900 direct jobs in 2024, largely from AI model work and data-centre buildouts 2.
- Long-run outcomes remain unclear. Much turns on whether AI ends up supporting human work or replacing it 1.
- Effects should vary by sector. German industry more often expects job cuts, while some technology-related services like IT or information processing expect employment growth 3.
