AI and Europe's labor market

Abstract

Adoption of AI has accelerated in Europe, especially after 2022. To adopt AI, firms need employees with data and AI skills, but small firms in particular lack the necessary expertise. AI shifts skill demand in exposed occupations, requiring AI skills combined with judgment and decision-making skills. AI changes what workers do on the job - it has not, so far, destroyed jobs. Productivity gains from AI remain largely invisible in aggregate statistics - so far.