Artificial Intelligence – Will Boosted Productivity Lead to Better Pay?

AI’s effects on the workplace are currently a topic of heated debate since while AI applications offer potential productivity gains for those that work with them, they also threaten their jobs. For this reason, a more detailed view of those affected can provide a clearer picture of the specific effects AI may have on their employment situation. Analysing the results of the 2020 German Socio-Economic Panel shows that, in the survey period, 37 per cent of employees in Germany were working with AI applications. AI-using employees tend to be male, aged between 18 and 44 and either master craftsmen or university graduates. They are less likely to express concerns about their ability to keep up with technological progress and more worried that their professional qualifications could lose their value. A multivariate analysis shows that, regardless of how intensively they work with AI applications, the gross hourly wages of employees who do so are on average 4 per cent higher than those who do not. In contrast to previous technological innovations, which tended to benefit the highly qualified most, there is a positive correlation between pay levels and AI use for all educational groups.