Ministers McGrath and Burke publish ‘Artificial Intelligence: Friend or Foe’ reports

Minister for Finance, Michael McGrath TD and Minister for Enterprise, Trade and Employment, Peter Burke TD, today welcomed the publication of a series of reports examining the potential impact Artificial Intelligence will have on the Irish economy and labour market. The series, Artificial Intelligence: Friend or Foe , consists of three reports:

‘Artificial Intelligence: Friend or Foe? Summary and Public Policy Considerations’ provides a high-level summary of the research undertaken, and identifies several policy questions that will require considered, evidence-based responses so that Ireland can fully avail of the benefits offered by AI, while also mitigating the negative aspects.
‘Artificial Intelligence: Friend or Foe? A Review of How AI Could Impact Ireland’s Economy’ includes a literature review on the potential macroeconomic impacts of AI adoption, summarising some of the channels through which the mainstreaming of AI into the production process could impact on the economy.
‘Artificial Intelligence: Friend or Foe? An Analysis of How AI Could Impact Ireland’s Labour Market’ assesses the potential impact of AI on the Irish labour market, utilising methodologies developed by the IMF to create a complementarity-adjusted AI occupational exposure index for Ireland. The index is used to identify the occupations in Ireland that are most exposed to AI, and the extent to which AI is a substitute or complement for labour in those occupations.

Commenting on the publications, the Minister for Finance, Michael McGrath TD, said:

“The analysis published today is very timely. The series of reports prepared by our two Departments raise important policy questions for the public finances, international competitiveness, productivity, and how we can use AI technologies to support sustainable and equitable economic growth.

It is clear that AI has the potential to have very positive transformative effects, improving living standards and our quality of life generally. However, we know from historical experience that technological advancement can sometimes cause labour market disruption.

It is essential that workers are supported to gain or improve the skills required to fully utilise AI as a supporting technology, or in a transition to roles that require different skills with social safety nets that are fit-for-purpose. In this regard we are taking action to ensure that the public finances are in a position to absorb the structural changes that are likely to happen.

We will continue to work across all relevant Government Departments to ensure that our economic and labour market analyses and policies are responsive to the rapidly changing nature of these technologies.”

The Minister for Enterprise, Trade and Employment, Peter Burke TD, said:

“I welcome not just the publication of these reports but the joint efforts across our two Departments that has underpinned this work. This series of reports should be seen as an early contribution to the discourse on the impacts of increased AI adoption in Ireland.

It is clear that we are on the cusp of a swathe of technological changes: from AI to quantum computing to gene therapy. Every significant technological advance brings changes to the labour market. AI will be no different in that regard. The exact nature of these changes is uncertain, but this does not mean that we are unprepared.

The Government is working to implement the National AI Strategy – “AI - Here for Good” with the aim of driving the development and adoption of trustworthy, person-centred AI for economic and societal good. The Government has also established an AI Advisory Council, chaired by Dr. Patricia Scanlon, which will provide independent advice to Government.

While the impact of AI is uncertain, this works makes a valuable contribution to furthering our understanding of the range of possible impacts. The Government stands ready to embrace the opportunities for our economy and society”.

Editor’s Notes

This Irish-specific analysis, contained in ‘Artificial Intelligence: Friend or Foe? An Analysis of How AI Could Impact Ireland’s Labour Market’ utilises methodologies developed by Felten et al. (2021) and the IMF (2023) regarding AI’s potential impact on the labour market.

There are important caveats with this analysis. Firstly, the measures of exposure and complementarity used are both relative measures, describing which occupations are comparatively more exposed or complementary than others.

Furthermore, the measure of AI exposure used in the study focuses on 10 specific AI applications, all of which can be considered to be “narrow” AI. They do not capture the latest advancements in AI technology, such as document summarisation or LLM-based searching. Importantly, the AI exposure measures also do not capture exposure to robot technologies.

The analysis shows that:

Ireland’s labour market is marginally more exposed to AI than the advanced economy average (63% vs 60%).
Overall, 33 per cent of employment is in occupations where AI is likely to complement labour (to boost productivity); 30 per cent of employment is in occupations where there is a risk that AI could substitute for labour.
Females appear to be relatively more exposed to AI than males, arising from the fact more women are employed in highly exposed administrative or customer occupations. Males, on the other hand, are more likely to be employed agricultural or construction-related roles, which are relatively less exposed to AI.
At a sectoral level, persons working in the ‘Financial and Insurance’ and ‘Information and Communication’ sectors are most exposed to AI. The ‘Agriculture, Forestry and Fishing’ sector is the least exposed.
From a regional perspective, persons working in urban areas are relatively more exposed to AI than rural areas. Dublin is the region with the highest share of persons working in relatively highly exposed roles, at 71 per cent.
Preliminary analysis also indicates that there is a positive correlation between AI exposure and earnings, suggesting that higher earners stand to benefit most from increased AI adoption. A similar correlation is observed for educational attainment.