"Study": Artificial Intelligence May Lead to Wage Cuts for Low-Skilled Employees

A study published by the Ifo Institute on Wednesday revealed that a large proportion of German companies using artificial intelligence expect the technology to lead to lower wages for employees with limited experience and skills.

The Munich-based institute based its findings on a survey conducted last June, which included more than 3,000 German companies that have begun integrating AI into their operations.

The study quoted Ifo researcher Anna Rover as saying, “From the perspective of a significant number of companies, AI will not affect all employees’ wages in the same way.”

According to the study, nearly half of the surveyed companies believe that employees “with less than five years of professional experience will receive lower wages.”

Conversely, 40% of companies expect to reduce the salaries of employees “with at least five years of professional experience.”

The study also highlighted disparities based on educational levels, distinguishing between those with university degrees and those without.

Jobs that rely on repetitive tasks and require limited digital skills are among the most vulnerable to replacement by AI-driven automation.

This effect is exacerbated by experience: only 5.9% of companies believe that AI may increase wages for workers without university degrees and with less than five years of professional experience.

In contrast, experienced workers are more likely to benefit from the productivity gains offered by AI.