We document near-exponential growth in the demand for artificial intelligence (AI)-related skills in India’s services sector since 2016, using a new dataset of online vacancies from its largest jobs website. This coincides with the take-off in developed countries, and is driven by the largest firms and high-tech clusters. We evaluate the impact of demand for AI skills on establishment-level non-AI postings, using a shift-share design that exploits variation in exposure to new AI inventions. We find negative effects on posting volumes and wage offers, particularly for highly skilled managerial and professional occupations, non-routine work, and analytical and communication tasks.
STEG Working Paper Series • Research Theme 1: Firms, Frictions and Spillovers, and Industrial Policy, Research Theme 2: Labour, Home Production, and Structural Transformation at the Level of the Household, Cross-Cutting Issue 3: Inequality and Inclusion