AI Adoption and the Demand for Managerial Expertise

Abstract

This paper investigates how AI adoption influences the demand for managers and their required skills. Using a skills-based measure of AI adoption derived from Lightcast job postings data, we show that when firms intensify their AI adoption they experience a significant increase in the number and share of managerial vacancies, indicating that AI implementation drives a greater demand for managerial roles. Furthermore, AI adoption shifts the skill requirements for managers, increasing the demand for cognitive and interpersonal skills such as collaboration, creativity, stakeholder management, and data analysis, while reducing the need for routine administrative skills like scheduling and budgeting. These findings suggest that AI reshapes organizations by increasing the importance of managerial expertise and by changing managerial roles and responsibilities within firms.

Keywords: artificial intelligence, managers, skills, technology adoption

JEL Classification: D22, E22, J23, J24