IDEAS home Printed from https://ideas.repec.org/a/eee/ecolet/v247y2025ics0165176525000205.html
   My bibliography  Save this article

AI and employment in Europe

Author

Listed:
  • Guarascio, Dario
  • Reljic, Jelena

Abstract

This paper contributes to the growing research on AI's labour market impact by presenting novel evidence on the heterogeneous employment effects of AI across EU countries from 2012 to 2022. While concerns persist about AI's disruptive potential, our findings show that occupations more exposed to AI technologies experience stronger employment growth, all else being equal. However, these effects are not uniform across the EU. Positive employment outcomes are concentrated in Innovation Leaders (Belgium, Denmark, Finland, the Netherlands and Sweden) and Strong Innovators (Austria, Cyprus, France, Germany, Ireland and Luxembourg), emphasising the context-dependent nature of AI's impact. These findings reflect the uneven distribution of innovation capabilities, with a country's innovation system and ‘absorptive capacity’ playing a crucial role in fully harnessing AI's potential for employment (and economic) growth. Ultimately, this research challenges the notion of AI as universally beneficial or harmful, highlighting its asymmetric effects across countries and occupations.

Suggested Citation

  • Guarascio, Dario & Reljic, Jelena, 2025. "AI and employment in Europe," Economics Letters, Elsevier, vol. 247(C).
  • Handle: RePEc:eee:ecolet:v:247:y:2025:i:c:s0165176525000205
    DOI: 10.1016/j.econlet.2025.112183
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0165176525000205
    Download Restriction: Full text for ScienceDirect subscribers only

    File URL: https://libkey.io/10.1016/j.econlet.2025.112183?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    AI; Employment; Europe;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:ecolet:v:247:y:2025:i:c:s0165176525000205. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/ecolet .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.