Danish companies adopting AI hire fewer employees

Danish companies that have adopted artificial intelligence (AI) subsequently hire fewer workers than similar companies that do not use the technology, the Danish central bank stated on Wednesday, according to Xinhua.

An analysis released by Danmarks Nationalbank shows that the slowdown in employment growth is most visible among young and highly educated workers. However, there are no signs that wages have been affected.

“The transformation we anticipate from AI has begun in Denmark,” said Signe Krogstrup, a Danish economist and one of the central bank’s governors.

A related working paper published by the bank found that the impact of AI implementation on employment is concentrated within small companies and is reflected in reduced recruitment, particularly for roles exposed to AI.

However, the bank stated there is no clear evidence that AI has affected overall employment in Denmark. According to Krogstrup, this suggests that workers who might have joined companies implementing AI have instead found employment elsewhere.

The analysis combines data from Statistics Denmark regarding AI usage by companies with administrative records related to employment and wages.

Krogstrup noted that the long-term impact remains highly uncertain. While a decline in employment cannot be ruled out, AI could also drive the emergence of new businesses and types of jobs, potentially increasing overall employment.