AMRO Cafe Seminar:  Who Takes the Hit? The Uneven Impacts of Generative AI on Labor Demand Across Countries

Join us for the July edition of the AMRO Cafe Seminar, featuring the paper “Who Takes the Hit? The Uneven Impacts of Generative AI on Labor Demand Across Countries,” by Dr. Shu Yu of the World Bank and Dr. Xianguo (Jerry) Huang of AMRO.

Has generative AI begun to displace workers globally, or only in high-income countries? This paper exploits the November 2022 release of ChatGPT as a technology shock and applies difference-in-differences and event study designs to 555 million Lightcast job postings spanning 84 countries from 2021Q1 to 2025Q2, comparing labor demand across occupations with high versus low AI-substitution vulnerability. In high-income countries, postings for above-median-vulnerability occupations declined by 5.8 percent on average relative to less substitutable occupations—after controlling for GenAI exposure and monetary policy sensitivity—with the effects intensifying over time. In middle- and low-income countries, the impact is much smaller and statistically insignificant. Cross-country analysis suggests that certain channels may have driven this divergence: displacement is larger in higher-income countries and, conditional on GDP per capita, in countries with greater GenAI adoption, more years of schooling, stronger English proficiency, and greater specialization in digital services trade. Together, these findings suggest that limited AI adoption, the absence of complementary factors for adoption, and potentially less exposure to digital services trade have so far muted the labor displacement effects in middle- and low-income countries.

By invitation only.

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