Strategic policy action is required to mitigate the disruption that artificial intelligence (AI) technologies are likely to create within the Irish labour market, the Central Bank of Ireland has warned, and to ensure some categories of workers are not left behind.
In a research article published on Wednesday, economists Anil Yadav and Tara McIndoe-Calder write that digital transformation, particularly due to the adoption of AI and automation technologies, is one of the big structural forces that will shape Irish living standards in the long term.
While AI presents significant opportunities for companies to improve productivity, exposure to the technology is uneven across occupations, the economists found.
Around 31 per cent of the workforce here – chiefly those in clerical and customer services roles – is potentially exposed to job “substitution risk” from AI, according to the report.
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Engineers and other “knowledge-intensive” roles are likely to see their jobs “augmented” rather than replaced by AI, meanwhile.
Digital skills gaps, however, can act as a barrier to occupational mobility and “targeted reskilling and upskilling initiatives” will be required to bridge the divide.
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The economists also said that due to the rapid pace of change and innovation in AI technologies, institutional support and investment in “lifelong learning” will be required, as well as close monitoring of the situation and the labour market as a whole, so policy can be adapted.
To prevent “polarisation” within the labour market, “priority policy actions” are required, the economists said.
They could “include scaling lifelong learning, helping SMEs (small and medium enterprises) to adopt technology, smooth reskilling and mobility pathways, and maintaining targeted routes for high-skilled migration while strengthening domestic talent pipelines”.
The researchers concluded: “Strategic policy action that combines upskilling to reduce displacement with reskilling to facilitate worker transitions into new roles will be essential to avoid disruption and may even facilitate inclusive, durable growth.”
Last month, the Department of Finance warned that the Republic’s labour market is “particularly exposed” to AI-related disruption, and younger workers in highly digitised sectors are the most at-risk group.
In an economics research paper, the department said that it has found evidence AI may have already influenced employment patterns in Ireland, with “at-risk” sectors experiencing weaker employment growth in recent years relative to less-exposed sectors.
“These effects appear to be concentrated among younger workers, in particular in the ICT sector – consistent with international evidence which suggests that AI adoption is having its most pronounced impacts on entry-level and junior employees in highly digitalised sectors,” it said.
