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)