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AI in demand: How expertise shapes its (early) impact on workers

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  • Storm, Eduard
  • Gonschor, Myrielle
  • Schmidt, Marc Justin

Abstract

We study how artificial intelligence (AI) affects workers' earnings and employment stability, combining German job vacancy data with administrative records from 2017-2023. Identification comes from changes in workers' exposure to local AI skill demand over time, instrumented with national demand trends. We find no meaningful displacement or productivity effects on average, but notable skill heterogeneity: expert workers with deep domain knowledge gain while non-experts often lose, with returns shaped by occupational task structures. We also document AI-driven reinstatement effects toward analytic and interactive tasks that raise earnings. Overall, our results imply distributional concerns but also job-augmenting potential of early AI technologies.

Suggested Citation

  • Storm, Eduard & Gonschor, Myrielle & Schmidt, Marc Justin, 2025. "AI in demand: How expertise shapes its (early) impact on workers," Ruhr Economic Papers 1185, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    • Handle: RePEc:zbw:rwirep:333893
    DOI: 10.4419/96973370
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    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • 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
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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