Corporate sustainability and artificial intelligence-enabled workforce transformation: a dual-pathway model of employee capability, empowerment, anxiety, and job insecurity

While prior studies have identified the productivity and innovation gains of AI, there is increasing evidence of anxiety, job insecurity, and psychological risks arising from the technology transition. This study proposes and empirically investigates a dual-pathway model of the developmental and threat-related outcomes that accompany the introduction of AI in the workplace. The study is based on Job Demands–Resources (JD-R) theory and Social Cognitive Theory (SCT), conceptualizing the integration of AI as both a resource for enhancing the capability of workforce transformation and a demand that can trigger AI anxiety. The survey was conducted with 530 employees in China, and the data were analyzed with PLS-SEM. The results indicate that the use of AI is positively and significantly associated with the ability to transform the workforce and thus psychological empowerment. Psychological empowerment, in turn, is also positively and significantly associated with corporate sustainability. As AI gets integrated, the anxiety of AI is also positively associated with job insecurity and, in turn, psychological wellbeing. The sequential mediation results also further indicate that workforce transformation capability and psychological empowerment sequentially mediate the positive association between AI integration and corporate sustainability, while AI anxiety and job insecurity sequentially mediate the negative association between AI integration and psychological wellbeing. Corporate Sustainability is, however, conceptualized as employees' perceptions of their organization's sustainability-related practices. The findings reveal that the workplace transformation with the help of AI cannot be seen as either positive or negative. Rather, its impacts rely on the ways in which employees view technological change: either as a chance for ability development and empowerment or as a cause of worry and job uncertainty. The study makes a unique contribution to the field of AI and organizational research by combining opportunity- and threat-oriented mechanisms in a single theoretical framework and by showing the relevance of employee capabilities and psychology in sustaining AI transformation. The findings also provide practical implications for organizations seeking to adopt AI while supporting employee adaptability, empowerment, wellbeing, and sustainability.