"AI in the Workplace: Job Shifts and Predicted Layoffs"
Companies anticipate staff reductions due to advancements in artificial intelligence.
Get ready for potential job changes as AI takes over. In a survey by the Ifo Institute, nearly a third of companies admitted they expect to see a decrease in jobs due to AI in the coming years, with industry and retail being the most affected sectors. Only the construction industry seems to avoid significant changes [1][2].
Klaus Wohlrabe, head of Ifo surveys, explained, "Companies, especially those in industry, anticipate accelerated structural transformation due to AI" [1]. The survey found that 37.3% of companies in industry expect job cuts, while just 5.2% expect additional jobs [1]. In retail, the proportion is similarly above average, hovering at nearly 30% [1]. However, companies in the construction sector do not foresee major shifts.
The survey also indicates that AI is expected to create new job opportunities, predominantly in technology-related services such as IT or information processing. As Wohlrabe stated, "AI will not only serve as a rationalization tool, but also the starting point for new job profiles" [1].
While the immediate impact of AI on job markets is currently limited, the long-term implications could be profound. The challenge is to convert productivity gains into widespread prosperity and mitigate the potential disruptions in certain occupations.
Interestingly, the Ifo Business Climate Index has shown signs of improvement, rising from 86.9 points in April to 87.5 points in May 2025 [1][3]. However, reluctance towards future business conditions lingers, with only 12.6% of companies anticipating improvement in 2025 [1][3]. Furthermore, economic uncertainty and structural challenges have led to reduced investment plans, which might affect how AI is integrated into businesses [3].
The German Artificial Intelligence in Retail Market is poised for substantial growth, projected to increase from USD 494.55 million in 2023 to USD 5,988.14 million by 2032 [5]. This expansion is driven by advancements in AI technologies and the increasing demand for personalized shopping experiences [5].
In summary, the Ifo Institute's research reveals the anticipated job displacement risks associated with AI and the broader economic challenges facing German businesses as they approach AI integration with caution.
[1] ntv.de[2] lar/AFP[3] ifo Institute[4] Mannesmann, F., Tiemann, A., Küster, K., & Hufkens, T. (2021). AI im Unternehmen - Chancen und Herausforderungen [AI in Business - Opportunities and Challenges] (ifo Forschungsheft, Bd. 192). Munich: ifo Institut - Leibniz-Institut für Wirtschaftsforschung an der Technischen Universität München.[5] Grand View Research, Inc. (2022). Artificial Intelligence in Retail Market Report - Growth, Trends, and Forecast 2023-2032. Grand View Research.
In light of the predicted job displacement due to AI, it's crucial for affected sectors like industry and retail to consider vocational training programs for their workforce, ensuring a smooth transition into new technology-driven roles. On the contrary, the German Artificial Intelligence in Retail Market is projected for significant growth, indicating a potential need for investment in AI finance and expertise in artificial-intelligence technology.
