AI-Driven Technological Change and Its Effects on Employment Distribution in Developing Countries

This research paper examines the effects of AI-driven technological change on employment distribution in developing countries. As artificial intelligence (AI) continues to advance, it is increasingly integrated into various sectors, raising concerns about job displacement, skill mismatches, and inequality in labor markets that are already fragile. The study aims to analyze how AI technologies are reshaping the structure of employment specifically, which sectors are most affected, who is most vulnerable, and what opportunities may arise. Using a mixed-methods approach, the study combines secondary data analysis from labor and technology reports with qualitative insights from expert interviews across select developing economies. Key findings reveal a trend toward automation in low and mid-skill jobs, particularly in manufacturing and administrative roles, while creating new demand in digital, data, and AI-related sectors. However, the benefits are unevenly distributed, with urban, educated populations better positioned to adapt than rural or informal workers. The paper concludes that while AI holds transformative potential for development, its deployment must be accompanied by targeted policies in education, digital infrastructure, and labor protection to avoid deepening socioeconomic divides. The findings contribute to a growing body of literature on technological disruption and offer practical insights for policymakers in the Global South.