Exposure to artificial intelligence and occupational mobility : a cross-country analysis

Title page 1

Contents 1

ABSTRACT 1

1. INTRODUCTION 2

2. DATA AND METHODOLOGY 5

3. LABOR MARKET CHARACTERISTICS 7

3.1. WORKER CHARACTERISTICS 7

3.2. LABOR MARKET TRANSITIONS 8

4. TRANSITIONS AND AI EXPOSURE 9

4.1. SENSITIVITY ANALYSIS 14

4.2. WHICH WORKERS SWITCH OCCUPATIONS? 14

5. LIFE-CYCLE DYNAMICS 15

5.1. EMPLOYMENT SHARES 15

5.2. WAGES 16

5.3. EXPECTED IMPACT OF AI LIFETIME EARNINGS 19

6. INFORMALITY IN BRAZIL 21

6.1. INFORMALITY AND AI EXPOSURE 22

7. CONCLUSION 23

ACKNOWLEDGEMENTS 24

REFERENCES 25

Tables 7

Table 1. Labor Market Summary Statistics for the UK and Brazil 7

Table 2. UK and Brazil, labor market flows by education level 8

Table 3. UK and Brazil, Employer and Occupation Switching Probabilities 9

Table 4. Premia and Standard Deviation of Log Wages by AI Exposure 10

Table 5. Distribution of Employment by AI Exposure and Education 11

Table 6. UK and Brazil: Regression of Transition Probabilities on Workers' Characteristics 13

Table 7. Changes in Expected Lifetime Earnings 20

Table 8. Employment Flows for Informality in Brazil 21

Table 9. Job and Occupation Switching Probabilities for Brazil 22

Figures 11

Figure 1. Transition Probabilities Conditional on Occupation Switching 11

Figure 2. Transition Probabilities by Education 12

Figure 3. UK and Brazil: Transitions to other occupation groups by wage decile 15

Figure 4. Life-cycle Profile of Employment Shares 17

Figure 5. Life-cycle Profile of Wages 18

Figure 6. Wage Premia for Transitions 19

Figure 7. Employment Share by Formality and Category 22

Figure 8. Transition Probabilities cond. on Occupation Switch, Formality, and Education 23