ESRI Study: 7% of Irish Jobs at Risk from AI Adoption, with Inequality Set to Rise
New ESRI research shows AI could displace 7% of Irish jobs in the short-to-medium term, concentrated among high-skilled workers, with income inequality likely to increase.
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Job Displacement Risk Concentrated Among High-Skilled Workers
A new study from the Economic and Social Research Institute (ESRI) found that around 7% of current jobs in Ireland could be displaced in the short-to-medium term due to AI adoption.
Crucially, job losses from AI adoption in Ireland are concentrated among highly educated workers, reflecting the strong exposure of high-skilled occupations to AI technologies. The ESRI report highlights that occupations facing higher levels of job losses include information and communications technicians, customer service clerks and clerical support workers.
In contrast, roles that are customer-facing or physically demanding face little risk of substitution from AI, including health professionals, agricultural workers, builders and refuse workers.
Income Inequality Expected to Rise
An ESRI and Department of Finance joint report found that AI adoption in Ireland is likely to lead to moderate increases in income inequality. Karina Doorley of the ESRI stated that income inequality, measured by the Gini coefficient, is likely to rise in any AI adoption scenario as job losses and wage and capital income increases result in income polarisation.
Fiscal Impact Depends on Scale of Job Displacement
The ESRI report concluded that if employment losses are small or reallocation of workers is fast, Exchequer revenue may increase due to productivity gains. However, if job displacement is large, income tax receipts will fall and welfare spending will rise.
Global Context
Ireland’s experience mirrors broader concerns internationally. Joseph Briggs, Senior Global Economist at Goldman Sachs, estimates that more than 9 per cent of the labour force, or around 15 million workers in the United States, could be displaced during a 10-year AI transition.
However, not all experts predict severe employment impacts. Daron Acemoglu, Institute Professor at MIT and Nobel laureate in Economics, expects AI to have only a modest net negative impact on employment over the next five years. Neil Thompson, Director of the FutureTech research project at MIT’s Computer Science and Artificial Intelligence Laboratory, stated that reliability, access to data, costs and practical deployment remain major constraints on AI adoption.
Source: RTÉ (reporting ESRI study)
Developments since publication
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The ESRI report on AI and income inequality in Ireland was co-published by the ESRI and the Department of Finance. Source
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In the ESRI's central scenario, around 7% of current jobs in Ireland could be displaced in the short-to-medium run due to AI adoption. Source
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The ESRI estimates that workers in Ireland who are not displaced by AI may see modest but broadly shared wage gains, but these gains are not large enough to counterbalance the average fall in income d Source
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The ESRI finds an average decline in household disposable income in Ireland as a result of AI adoption, with the largest average losses experienced by middle and higher income households. Source
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Income inequality in Ireland, measured by the Gini index, rises moderately in every scenario examined by the ESRI due to the polarising effect of AI-driven job losses and wage and capital income incre Source
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The ESRI warns that if AI accelerates the shift from labour income to capital income in Ireland, the current heavy reliance on labour taxation may become increasingly difficult to sustain. Source
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The ESRI used SWITCH, its microsimulation model, to investigate the potential distributional effects of AI adoption in Ireland by linking AI adoption scenarios to the Irish tax-benefit system. Source
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The ESRI report was authored by Karina Doorley, Sorcha O'Connor, Richard O'Shea, and Dora Tuda. Source