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Socio-Economic Statistics Research, 2025, 6(2); doi: 10.38007/SESR.2025.060219.

Measuring the Sensitivity of Local Skill Structures to AI Substitution Risks Based on Occupational Task Decomposition

Author(s)

Dingyuan Liu

Corresponding Author:
Dingyuan Liu
Affiliation(s)

School of Engineering and Applied Science, University of Pennsylvania220 S 33rd St, Philadelphia, PA 19104

Abstract

This study proposes a task–skill–place framework to quantify how sensitive U.S. local labor markets are to AI substitution risks. Building on task-based theories of technological change, we argue that modern AI - especially generative AI and multimodal foundation models - affects employment primarily by reshaping task portfolios within occupations, and therefore by reweighting the skills embedded in local economies. We integrate O*NET’s occupational task decomposition and skill-importance structure with leading AI exposure measures that map current AI capabilities onto tasks (LLM/GPT task exposure, ability-based AI Occupational Exposure, and AI patent–task overlap). Using BLS Occupational Employment and Wage Statistics (May 2024) as local employment weights, we define a Local AI Skill Substitution Sensitivity (LASSS) index that measures the exposed share of each locality’s skill bundle, not merely its exposed jobs. Nationally, the exposure baseline is broad: GPT-class models are estimated to affect at least 10% of tasks for roughly four-fifths of U.S. workers and at least half of tasks for about one-fifth, with exposure concentrated in language- and analysis-heavy occupations. The exposed skills cluster in written comprehension and expression, inductive/deductive reasoning, information ordering, complex problem solving, and programming-adjacent systems analysis, whereas physical dexterity, equipment operation, in-person caregiving, and embodied services show lower near-term substitutability. Aggregating to place reveals steep geographic dispersion: U.S. Treasury evidence shows a four-to-one gap between the most- and least-exposed local areas, with dense, highly educated metros - especially in the Northeast corridor - embedding far more of the exposed analytic-communication skill bundle than rural or manufacturing- intensive regions. Interpreting exposure through LASSS clarifies that AI may widen regional inequality unless complemented by place-aware skill buffering in high-LASSS metros and diffusion-oriented adoption policies in low-LASSS regions.

Keywords

Occupational Task Decomposition; Local Skill Structure; Generative Ai Exposure; Regional Labor Markets

Cite This Paper

Dingyuan Liu. Measuring the Sensitivity of Local Skill Structures to AI Substitution Risks Based on Occupational Task Decomposition. Socio-Economic Statistics Research (2025), Vol. 6, Issue 2: 177-184. https://doi.org/10.38007/SESR.2025.060219.

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