Danish firms hire fewer workers after adopting AI: central bank

Danish companies that adopt artificial intelligence (AI) subsequently hire fewer workers than comparable firms that do not use the technology, Denmark's central bank said Wednesday, reported Xinhua.

An analysis released by Danmarks Nationalbank found that the slowdown in employment growth is particularly evident among younger and more highly educated workers; however, there are no signs that wages have been affected.

"The transformation we expected 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 employment effects of AI adoption were concentrated in smaller firms and reflected reduced recruitment, particularly in occupations exposed to AI.

However, the bank said there was no clear evidence that AI had affected Denmark's overall employment. Krogstrup said this suggested that workers who might otherwise have joined firms adopting AI had found jobs elsewhere.

The analysis combines Statistics Denmark data on companies' AI use with administrative records on employment and wages.

Krogstrup said the longer-term impact remained highly uncertain. While a decline in employment could not be ruled out, AI could also stimulate new businesses and job roles, potentially increasing employment.