IDEAS home Printed from https://ideas.repec.org/p/rif/wpaper/121.html

Assessing Early Labor Market Effects of Generative AI - Evidence from Population Data

Author

Listed:
  • Kauhanen, Antti
  • Rouvinen, Petri

Abstract

This study examines the short-term impact of generative artificial intelligence (GAI) on employment and wages using data covering all wage earners from Finland. Employing a synthetic difference-in-differences approach, we analyze how the launch of ChatGPT affected occupations with varying levels of exposure to GAI. Our findings reveal that wages increased more in highly GAI-exposed occupations compared to less exposed ones following ChatGPT’s introduction. However, we do not observe statistically significant changes in employment levels between more and less exposed occupations. Additional analyses comparing more- and less-exposed occupations within specific occupational groups yield qualitatively similar results. These findings contrast with some previous studies on online labor markets but align more closely with research using nationally representative data. The positive wage effect observed in AI-exposed occupations could indicate that GAI is primarily enhancing rather than replacing human labor. The lack of significant employment effects might suggest that the impact of GAI on job creation or destruction may take longer to materialize or might be offset by other factors in the labor market.

Suggested Citation

  • Kauhanen, Antti & Rouvinen, Petri, 2024. "Assessing Early Labor Market Effects of Generative AI - Evidence from Population Data," ETLA Working Papers 121, The Research Institute of the Finnish Economy.
    • Handle: RePEc:rif:wpaper:121
    as

    Download full text from publisher

    File URL: https://www.etla.fi/wp-content/uploads/ETLA-Working-Papers-121.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Daron Acemoglu & David Autor & Jonathon Hazell & Pascual Restrepo, 2022. "Artificial Intelligence and Jobs: Evidence from Online Vacancies," Journal of Labor Economics, University of Chicago Press, vol. 40(S1), pages 293-340.
    2. Stefania Albanesi & António Dias da Silva & Juan F Jimeno & Ana Lamo & Alena Wabitsch, 2025. "New technologies and jobs in Europe," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 40(121), pages 71-139.
    3. Damian Clarke & Daniel Paila~nir & Susan Athey & Guido Imbens, 2023. "Synthetic Difference In Differences Estimation," Papers 2301.11859, arXiv.org, revised Feb 2023.
    4. Dmitry Arkhangelsky & Susan Athey & David A. Hirshberg & Guido W. Imbens & Stefan Wager, 2021. "Synthetic Difference-in-Differences," American Economic Review, American Economic Association, vol. 111(12), pages 4088-4118, December.
    5. Edward Felten & Manav Raj & Robert Seamans, 2021. "Occupational, industry, and geographic exposure to artificial intelligence: A novel dataset and its potential uses," Strategic Management Journal, Wiley Blackwell, vol. 42(12), pages 2195-2217, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Enrico Maria Fenoaltea & Dario Mazzilli & Aurelio Patelli & Angelica Sbardella & Andrea Tacchella & Andrea Zaccaria & Marco Trombetti & Luciano Pietronero, 2024. "Follow the money: a startup-based measure of AI exposure across occupations, industries and regions," Papers 2412.04924, arXiv.org, revised Dec 2024.
    2. Guarascio, Dario & Reljic, Jelena & Stöllinger, Roman, 2025. "Diverging paths: AI exposure and employment across European regions," Structural Change and Economic Dynamics, Elsevier, vol. 73(C), pages 11-24.
    3. Guarascio, Dario & Reljic, Jelena, 2025. "AI and employment in Europe," Economics Letters, Elsevier, vol. 247(C).
    4. Luca Fontanelli & Flavio Calvino & Chiara Criscuolo & Lionel Nesta & Elena Verdolini, 2024. "The role of human capital for AI adoption: Evidence from French firms," Post-Print hal-05029748, HAL.
    5. Miteva, Daniela A. & Ellis, Edward A. & Ellis, Peter W. & Sills, Erin O. & Griscom, Bronson W. & Rodriguez-Ward, Dawn & Naples, Colette & Uematsu, Claire, 2025. "Community sawmills can save forests: Forest regrowth and avoided deforestation due to vertical integration of wood production in Mexican community forests," Ecological Economics, Elsevier, vol. 236(C).
    6. Koch, Michael & Lodefalk, Magnus, 2024. "Artificial Intelligence and Worker Stress: Evidence from Germany," Ratio Working Papers 377, The Ratio Institute.
    7. Jaccoud, Florencia, 2025. "Robots & AI Exposure and Wage Inequality," MERIT Working Papers 2025-013, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    8. repec:ces:ceswps:_10955 is not listed on IDEAS
    9. Hobbs, Duncan & Strain, Michael R., 2024. "Do Reemployment Bonuses Increase Employment? Evidence from the Idaho Return to Work Bonus Program," IZA Discussion Papers 16924, Institute of Labor Economics (IZA).
    10. Kristina McElheran & J. Frank Li & Erik Brynjolfsson & Zachary Kroff & Emin Dinlersoz & Lucia Foster & Nikolas Zolas, 2024. "AI adoption in America: Who, what, and where," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 33(2), pages 375-415, March.
    11. Roberto Esposti, 2025. "Do rural development policy measures really affect farmers' behaviour and performance? A synthetic difference in differences estimation," Working Papers 494, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
    12. Minniti, Antonio & Prettner, Klaus & Venturini, Francesco, 2025. "AI innovation and the labor share in European regions," European Economic Review, Elsevier, vol. 177(C).
    13. Dench, Daniel & Pineda-Torres, Mayra & Myers, Caitlin, 2024. "The effects of post-Dobbs abortion bans on fertility," Journal of Public Economics, Elsevier, vol. 234(C).
    14. Cerqua, Augusto & Ferrante, Chiara & Letta, Marco, 2023. "Electoral earthquake: Local shocks and authoritarian voting," European Economic Review, Elsevier, vol. 156(C).
    15. Flavio Calvino & Luca Fontanelli, 2025. "Decoding AI: Nine facts about how firms use artificial intelligence in France," LEM Papers Series 2025/13, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    16. Raphael Auer & David Köpfer & Josef Švéda & Raphael A. Auer, 2024. "The Rise of Generative AI: Modelling Exposure, Substitution, and Inequality Effects on the US Labour Market," CESifo Working Paper Series 11410, CESifo.
    17. Ozge Demirci & Jonas Hannane & Xinrong Zhu, 2024. "Who Is AI Replacing? The Impact of Generative AI on Online Freelancing Platforms," CESifo Working Paper Series 11276, CESifo.
    18. Ege Aksu & Charles J. Courtemanche & Dhaval M. Dave & Daniel L. Dench & Michael Grossman & Jooyoung Kim & Selen Ozdogan & Shubhsri Rajendra & Joseph J. Sabia & Henry Saffer, 2025. "The Effect of Online Sales Bans on E-Cigarette Use," NBER Working Papers 34565, National Bureau of Economic Research, Inc.
    19. Adolfsen, Jakob Feveile & Heissel, Malte & Manu, Ana-Simona & Vinci, Francesca, 2024. "Burn now or never? Climate change exposure and investment of fossil fuel firms," Working Paper Series 2945, European Central Bank.
    20. Rutar, Tibor & Rutar, Minea, 2025. "Liberalizing reforms do not cause suicide: Causal estimation using matching, 1980–2019," Journal of Comparative Economics, Elsevier, vol. 53(1), pages 272-289.
    21. Kishore, Prabhat & Roy, Devesh & Birthal, Pratap S. & Srivastava, Shivendra Kumar, 2024. "Regulation and Policy Response to Groundwater Preservation in India," Policy Papers 345044, ICAR National Institute of Agricultural Economics and Policy Research (NIAP).

    More about this item

    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
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:rif:wpaper:121. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: Kaija Hyvönen-Rajecki (email available below). General contact details of provider: https://edirc.repec.org/data/etlaafi.html .

    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.