Ifo Institute: Many Companies Expect Falling Wages Due to AI Use

The Ifo survey makes clear that the concern about wage losses affects not just individual sectors, but the breadth of the economy. The use of AI systems is apparently seen by many company managers as an opportunity to cut personnel costs — including through lower entry-level salaries.

What the Numbers Mean for Career Entrants

Economists are observing this development with a view to its consequences for the labor market. If young employees and career entrants have to reckon with lower salaries, this could also reduce the incentive to take up certain occupations that are heavily affected by AI use.

At the same time, experts point out that actual wage development will also depend on which tasks are replaced by AI and which new job profiles emerge. The survey primarily reflects companies' expectations, not necessarily the real upcoming developments in the labor market.

Economic Context of the Survey

The results come at a time when the use of generative AI in German companies is advancing rapidly. More and more companies are testing AI applications in administration, customer service, and production. Against this backdrop, firms' wage expectations are gaining weight.

For employees, the numbers represent a warning: according to many employers, those entering the labor market without a university degree could earn less in the future than they do today. Uncertainty about future wage development is high.

Reactions and Open Questions

The Ifo Institute is one of the most influential economic research institutes in Germany and regularly surveys thousands of companies on their assessments. The current data come from three independent sources and are considered statistically robust.

Anna Ruffert reported on the results for dpa. The survey was also picked up and disseminated by Dow Jones Newswires, further increasing the reach of the findings.

The debate over the social consequences of AI use is likely to gather pace with the new figures. Trade unions and social policymakers see this as a reason to discuss protective mechanisms for career entrants and less qualified employees.