Spain | AI: from job exposure to productivity

The Spanish labor market begins the year with a contrast. Job creation accelerated in the second quarter, reaching 0.7% quarterly according to the synthetic indicator of the Quarterly Labor Market Observatory, prepared by BBVA Research and Fedea. However, GDP per employed person has barely changed since the end of 2019, and productivity per hour worked has increased by 2.4%. Spain is creating jobs, but it needs to raise the productivity that sustains wages and well-being.

In this context, generative artificial intelligence (AI) opens up an opportunity, although its effects will be neither automatic nor homogeneous. An occupation's exposure to AI measures the capacity of this technology to perform or assist in the tasks that comprise it, but it is not equivalent to job destruction. AI can replace some tasks, complement others, and create new occupations, freeing up time for higher-value activities. Although the positive effect on productivity is more foreseeable, the net impact on employment will depend on its adoption, regulations, business organization, and the skills of the population.

The Observatory helps to frame the debate. Exposure is highest in administrative, financial, IT, and professional occupations, and lower in manual jobs linked to construction and the primary sector. More than 40% of people with higher education work in high-exposure occupations, compared to 15% of those with secondary education or less. By age, the 25 to 34-year-old population presents the highest average exposure.

These differences reflect the productive structure of the Spanish economy. In information technology, finance, insurance, and real estate activities, more than 80% of employment is concentrated in high-exposure occupations. Madrid exceeds 40%, followed by Catalonia, while Extremadura and Murcia are at the lower end. Nationality adds a gap: one-third of the Spanish employed population works in high-exposure occupations, compared to just over 20% of the foreign population. More than 40% of the latter is located in low-exposure occupations.

If complementarity prevails, AI can translate into productivity improvements and greater labor demand. Since 2022, employment in Spain has grown in all four occupational groups ordered by their degree of exposure, especially in those with medium-high and high exposure. The latter represent just over 30% of total employment. Although it is too early to draw causal conclusions, so far no negative relationship between AI exposure and employment has been observed.

The analysis of new entrants to the labor market shows that those who enter after finishing their studies are increasingly oriented towards occupations exposed to AI. Among entrants from abroad, however, low-exposure occupations predominate, although their presence in the most exposed ones has been growing since 2022. In both groups, underemployment and temporary work tend to be lower the higher the exposure.

The priority is to turn AI exposure into more productivity and better jobs. It is not enough to facilitate access to digital tools. Companies, especially small and medium-sized ones, need to accompany technological investment with organizational changes and training. The education system must reinforce the capabilities to use these tools, verify their results, and apply them to specific problems. Employment policies must facilitate reskilling and reduce the gaps that affect the population with less education and the immigrant working population. The goal is for AI to replace less productive tasks and complement those with higher added value, freeing up time for the latter.

AI can contribute to improving productivity, but it does not resolve its structural weaknesses on its own. Its impact will depend on the quality of human capital, the ability of companies to innovate, and institutions that favor technological diffusion. It is advisable to avoid both alarmism and complacency. The challenge is to expand opportunities for those who currently work in less exposed occupations and ensure that productivity gains translate into better wages, quality jobs, and greater well-being.