Artificial intelligence, tasks, skills, and wages: Worker-level evidence from Germany

Abstract

This paper examines how new technologies are linked to changes in the content of work and individual wages. As a first step, it documents novel facts on task and skill changes within occupations over the past two decades in Germany. We furthermore reveal a distinct relationship between ex-ante occupational work content and ex-post exposure to artificial intelligence (AI) and automation (robots). Workers in occupations with high AI exposure perform different activities and face different skill requirements compared to workers in occupations exposed to robots, suggesting that robots and AI are substitutes for different activities and skills. We also document that changes in the task and skill content of occupations is related to ex-ante exposure to technologies. Finally, the study uses individual labour market biographies to investigate the relationship between AI and wages. By exploring the dynamic influence of AI exposure on individuals over time, the study uncovers positive associations with wages, with nuanced variations across occupational groups, thereby shedding further light on the substitutability and augmentability of AI. • Task- and skill content of occupations has changed over the past two decades. • AI-exposed occupations face distinct skill and task demands compared to those in robotics-exposed occupation. • Robots and AI might act as substitutes for different activities and skills. • Increased AI exposure of occupations affects individual wages overall positive.