Early adopters of AI see rising headcounts

New research from the US contradicts predictions that the introduction of Artificial Intelligence (AI) will drive job losses.

The working paper found that companies that adopted generative AI grew their headcount by 10.2% over the two years following adoption. This is in stark contrast to comments from tech companies Oracle and Atlassian, which have cited AI investment when announcing layoffs. 

Companies making the largest AI investments saw entry-level headcounts growing 12% over the two years following adoption.

Yet the research has several stipulations; this increase in headcount only applied to companies defined as ‘high-intensity’ adopters. Many of those companies that saw benefits were high-growth firms, usually larger, more engineering-intensive and more likely to be venture-backed.

The research defined ‘high-intensity’ companies as those in the top third of per-employee, per-month AI spend in the first three months. Usually, the spend was on multiple AI models, primarily the most advanced and productivity-enhancing systems, in areas like coding agents rather than simpler chat subscriptions.

Paradoxically, the spending in the top third of companies was fairly low, about $30 per month, per employee and then increasing. 

The study also found that increased employment did not happen immediately. There was generally a six to 12-month hiatus before increases, partly because it took time for AI best practice to filter across the organisation.

The working paper, ‘A New Look at AI’s Impact on Jobs,’ used company-level spending data from US tech start-ups Ramp and Revelio Labs. Ramp joined with workforce data collected by Revelio Labs for more than 21,000 U.S. firms.

The research paper can be found here: https://ramp.com/data/ai-jobs-impact/paper