Skills in the AI age

As general-purpose technologies like the steam engine and electricity once revolutionised society, artificial intelligence (AI) is likewise doing so today. By enhancing productivity, stimulating economic growth and creating new job opportunities, AI could significantly enhance human work and the labour market. However, AI also presents challenges such as job displacements if the transition to using it is not properly managed. The effects of AI on employment differ across sectors, regions and cities, as well as across skill levels. Adapting to this shift requires developing new skills that align with evolving labour market demands. Policymakers play an essential role in ensuring workers are equipped to thrive in an AI-driven economy. This paper examines how AI is transforming labour markets, shifting skill requirements and the policy responses needed to harness AI’s transformative potential while mitigating its social and economic risks.