The Effects of Artificial Intelligence on Jobs: Evidence from an AI Subsidy Program

Mark Hellsten (), Shantanu Khanna (), Magnus Lodefalk and Yaroslav Yakymovych ()
Additional contact information
Mark Hellsten: University of Tubingen, https://ratio.se/
Shantanu Khanna: Northeastern University
Yaroslav Yakymovych: Uppsala University

No 386, Ratio Working Papers from The Ratio Institute

Abstract: Artificial intelligence (AI) is expected to reshape labor markets, yet causal evidence remains scarce. We exploit a novel Swedish subsidy program that encouraged small and mid-sized firms to adopt AI. Using a synthetic difference-in-differences design comparing awarded and non-awarded firms, we find that AI subsidies led to a sustained increase in job postings over five years, but with no statistically detectable change in employment. This pattern reflects hiring signals concentrated in AI occupations and white-collar roles. Our findings align with task-based models of automation, in which AI adoption reconfigures work and spurs demand for new skills, but hiring frictions and the need for complementary investments delay workforce expansion.

Keywords: Artificial intelligence; Labor markets; Hiring; Task content; Technological change (search for similar items in EconPapers)
JEL-codes: J23 J24 O33 (search for similar items in EconPapers)
Pages: 27 pages
Date: 2025-11-14
New Economics Papers: this item is included in nep-ain, nep-eur, nep-ino and nep-lma
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Related works:
Working Paper: The Effects of Artificial Intelligence on Jobs: Evidence from an AI Subsidy Program (2025)
Working Paper: The Effects of Artificial Intelligence on Jobs: Evidence from an AI Subsidy Program (2025)
Working Paper: The Effects of Artificial Intelligence on Jobs: Evidence from an AI Subsidy Program (2025)
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Persistent link: https://EconPapers.repec.org/RePEc:hhs:ratioi:0386

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