Ramp and Revelio Labs study of 21,559 firms finds high-intensity AI adopters grew headcount by 10% over two years

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Sources:

Study: https://ramp.com/data/ai-jobs-impact

Charts: https://www.ft.com/content/8026eac6-16ad-467d-b8c3-c48c5af684e6?syn-25a6b1a6=1

Narrative violation: A new study of 21,559 firms in the U.S. finds that “companies that adopt AI tend to grow faster following adoption”.

“Firms making the largest AI investments grow employment by roughly 10% following adoption, while low-intensity adopters see no statistically significant change.”

“Entry-level headcount rises 12% for high-intensity adopters.”

“Gains emerge gradually and are broad across roles, including engineering, sales, administration, and customer service.”

“The results counter predictions that AI adoption will lead to broad job loss.”

The study is based on observed AI spending from Ramp card and bill pay data linked to Revelio Labs workforce records.

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Ara Kharazian@arakharazian

Take small businesses for example. They are less likely to use AI in the first place, but when they do, they use it more intensely.

They may not have a dedicated engineering or finance team, so AI can unlock new revenue streams that previously required higher upfront investment.

Ultimately, I think this is the mechanism by which firms increase headcount upon AI adoption, even though AI presumably fulfills new and existing tasks for their teams. They can go do more things now.

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Ara Kharazian@arakharazian

First, you should be skeptical.

Companies that adopt AI are already faster growing.

We control for that by comparing early adopters against firms who haven't adopted yet. This allowed us to build like-for-like control groups of firms on nearly identical pre-adoption growth paths.

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Ara Kharazian@arakharazian

These gains are unevenly distributed.

A side result of this paper is that AI spreads through networks. Who funded you is a better predictor of AI adoption than the sector you’re in.

California-based tech companies are more likely to use AI than similar companies in New York.

There’s no inherent reason for that, but it's economically suboptimal.

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Ara Kharazian@arakharazian

Our main result: firms that adopt AI grow headcount 10% over two years. Two caveats.

1. Growth subject to a minimum threshold: "Low" adopters, we defined as the bottom two terciles of per employee per month, spend on AI see no change in hiring. High adopters spend ~$30 per employee per month in the first 3 months (rising thereafter, but not thousands of dollars).

2. Learning curve: Firms don’t see gains until 6-12 months following adoption.

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Ara Kharazian@arakharazian

Entry-level headcount grows even faster, 12% over two years.

This is our first evidence that high-AI adopting firms are hiring different kinds of employees.

We believe they are selecting for a new set of skills, specifically, people who know how to use AI and use it well.

Entry-level workers, especially recent graduates and college students, are a natural place to look.

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Ara Kharazian@arakharazian

Our paper is out TODAY, but this is not my last word. We will update these results as more data comes in.

Read our paper and explore your own job function: https://ramp.com/data/ai-jobs-impact

And read my substack about it here: https://econlab.substack.com/p/we-can-finally-say-ai-isnt-killing-jobs

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BucketBoyPlunger@N8BIZNESS

@DavidSacks Is this an argument for government expansion? Not referring to AI usage of course David

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GigaCocoN@GigaCocoN

@DavidSacks

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Houman Asefi@houmanasefi

@DavidSacks Ramp card spend as the AI adoption proxy. So the methodology is literally "which companies have enough cash flow to expense AI tools on a corporate card." What does that select for before you even get to the headcount numbers?

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Wonkapotamus Pug 🇺🇸@Wonkpug

@DavidSacks Whoa, look at that. It turns out that when you throw ridiculous amounts of cash at them, they hire people.

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Finance Lady@FinanceLady5

@DavidSacks Doomers should take this data that falsify their theories and stop scaring ppl - starting with that guy that runs Anthropic, who should be fired, btw. Dario Amodei. Who in their right mind creates a product he hates? Who in their right mind runs a company he hates?

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Bobo The Dodo@fbarnau

@DavidSacks I think this is because the companies that use more AI tend to be startups that are hiring and that are increasing headcount in percentage at a much higher rate due to their size.

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dk@DegenerateKong

@DavidSacks david, no one cares.

please, gib fable access.

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Citizen X@Soul_Angla

@DavidSacks Aye, oreet Dave - anything you say.

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Joyce Lynn@JoyceLynnt2bd

@DavidSacks @Thompsonklay Pleased Needed engagement for the people, industry. We are in an AI war, we must win. China’s population is embracing AI. Fear being driven in U.S., unfounded.

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Shamim Hossain@shamimai1

@arakharazian @tryramp @RevelioLabs Great one

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Martha Johnson@MarthaJohn1679

@DavidSacks AI makes tasks easier. It is accurate, doesn't get sleepy, bored, distracted or tired. AI does the things that takes people away from their tasks, such as email, reference searches and calculations. They become more productive because they get more actual work done.

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Jan Stevens@janstevens

@DavidSacks The high-intensity vs low-intensity split is the key detail here. AI adoption alone may not move the needle, but serious investment seems tied to broader growth, including entry-level roles.

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ksandiego@ksandiego63

@DavidSacks Interesting

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