AI Is Driving Up Demand for New Skills, Says Pissarides

Advances in artificial intelligence (AI) are changing the way companies operate and will require professionals to develop new skills throughout their careers. This was one of the key messages of the lecture “AI Disruptions in Labor Markets,” presented this Thursday (16) by the 2010 Nobel Prize in Economics laureate, Christopher Pissarides, during the 25th Conference of the Society for the Advancement of Economic Theory (SAET), held at IMPA.

A professor at the London School of Economics (LSE), Pissarides argued that the impact of artificial intelligence on employment will be more gradual than the most pessimistic analyses predict. Rather than a mass replacement of workers, he stated that the main transformation lies in the reorganization of activities within companies, with professionals taking on new roles and learning to use AI-based tools.

“The role of workers is changing on the job. They need to adapt to the use of artificial intelligence. Today, AI is used as a tool to help workers, not to replace them, with few exceptions.”

According to the economist, companies are already seeking professionals with AI-related skills, although many are still in the process of adapting and are not yet fully utilizing the technology’s potential. In this context, the ability to learn continuously becomes more important than an overly narrow specialization.

As an example of this shift, Pissarides cited a study conducted in the United Kingdom that shows executives and more experienced professionals turning to large language models (LLMs) to perform tasks that would previously have been delegated to early-career employees. In his view, this trend alters workflows but also creates new demands for skills.

Nobel also disputed predictions that artificial intelligence will cause a widespread collapse in employment. In his view, some jobs are likely to disappear, while others will be created as technology advances. The challenge will be to prepare workers for this transition.

“People are talking more and more about workers losing their jobs and becoming unemployed. That’s a very small part of the picture. There’s a lot of exaggeration. If we look at the macroeconomy—the big picture—we don’t see a significant impact.”

Pissarides also pointed out that AI has the potential to significantly boost economic productivity, but the benefits will not be distributed evenly among countries. According to him, this progress will depend on the ability to invest in infrastructure, technology, and innovation.

In the economist’s assessment, the United States currently has the best conditions to capitalize on this leap in productivity, as it concentrates capital and investment capacity in artificial intelligence applications. China ranks in the middle, while Europe, according to him, faces greater difficulties in capturing these gains.

The lecture was part of the program for the 25th SAET Conference, which brings together some of the leading researchers in the field of economic theory at IMPA to discuss recent advances in economics, mathematics, and public policy.