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A new study finds that 19.1% of employees at Korean companies with 50 or more employees are already being affected by artificial intelligence. While the expansion of AI hasn’t altered the total amount of employment or wages, some think the changing composition of employment could lead to more demand for professional positions and fewer numbers of middle-skill positions, including clerical jobs and service-sector jobs.

Joseph Han, a research fellow with the Korea Development Institute (KDI), announced the findings in a presentation on “the impact of AI technology on the labor market” at a KDI-Bank of Korea labor market seminar on Tuesday.

“While it can’t really be said that AI has yet entered widespread use, there has been an active introduction of technology at large corporations,” he observed, adding that “a considerable percentage of workers are employed at companies that have adopted AI technology.”

Han’s analysis, which was based on a Statistics Korea survey of corporate activities in 2021, found an AI adoption rate of just 3.8% among South Korean companies with 50 or more employees.

Another calculation based on the number of employees affected, however, showed an impact rate of 19.1%. In other words, roughly one in five employees at companies with 50 or more employees have already been exposed to AI.

By industry, the highest AI impact rate of 73.5% was observed in electricity and gas businesses, followed by finance/insurance (43.8%), information and communications (34.6%), education services (27.2%) and manufacturing (22.4%).

Other observations concerned the labor market changes that the adoption of AI is poised to bring about. Han commented that the changes caused by AI are related more to the nature of jobs than the scale of the labor market.

“Empirical analysis of Korean businesses and regional labor markets since the recent adoption of AI has not observed major changes in hiring or wages as a result of the AI impact rate, but clear changes have been noted in terms of age ranges, academic histories, and professions,” he said.

The analysis suggested that as the AI impact rate increases, it will translate into a stronger demand for specialist professions and less demand for jobs involving intermediate skills, including service, clerical and sales positions. It predicted much lower demand for younger workers and those with a vocational college education level or higher.

In other words, the expanding use of AI will give rise to a mismatch between labor supply and demand.

“For new duties and jobs to be created, there will need to be adequate changes to the duty composition and working conditions of those who are currently employed, within a reasonable scope,” Han predicted.

“We will also need a stronger social safety network, including reduced employment safety net blind spots and stronger unemployment benefit guarantees,” he stressed.

By Ahn Tae-ho, staff reporter

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