The effects of artificial intelligence on jobs : evidence from an AI subsidy program

Artificial intelligence (AI) is expected to reshape labor markets, yet causal evidence remains scarce. We exploit a novel Swedish subsidy program that encouraged small and mid-sized firms to adopt AI. Using a synthetic difference-in-differences design comparing awarded and non-awarded firms, we find that AI subsidies led to a sustained increase in job postings over five years, but with no statistically detectable change in employment. This pattern reflects hiring signals concentrated in AI occupations and white-collar roles. Our findings align with task-based models of automation, in which AI adoption reconfigures work and spurs demand for new skills, but hiring frictions and the need for complementary investments delay workforce expansion.