Artificial Intelligence and the Labor Market: Transmission Mechanisms, Employment Risks, and Economic Consequences

ABSTRACT The widespread diffusion of artificial intelligence (AI) has delivered a systemic shock to the global labor market, making it a central concern in macroeconomic policy and social governance. This paper systematically reviews 180 representative articles published in leading journals between 2000 and March 2026, with the aim of clarifying the transmission mechanisms and economic consequences of AI‐induced structural changes in employment. Using bibliometric and qualitative analyses, we show that research output in this field is strongly shaped by major technological breakthroughs—especially generative AI—and is geographically concentrated in economies such as the United States and China. We document a shift from static, aggregate measures of technological exposure toward dynamic, multidimensional vulnerability frameworks that integrate task content and micro‐level worker characteristics. We further synthesize evidence that AI's labor‐market impacts arise from interactions among technological attributes, individual endowments, organizational heterogeneity, and institutional environments. The resulting economic effects are asymmetric and mixed: productivity gains coexist with factor‐income polarization, while new skill demands are accompanied by heightened displacement risks, skill mismatches, and occupational insecurity. We conclude by outlining a future research agenda that addresses data limitations, identification challenges, and cross‐country comparability, and that supports dynamic, context‐sensitive policy responses.