Since the rise of artificial intelligence (AI), jobs with high exposure to generative and agentic AI have increased, but most of this job growth is concentrated in the capital area. In contrast, non-capital regions, which have a higher proportion of jobs exposed to physical AI in sectors like manufacturing, transportation, and hospitality, may face widening labor market disparities depending on the pace of technological advancement.
The Bank of Korea released a report on September 15 titled 'AI and Regional Labor Markets: Risks of Widening Disparities and New Opportunities.'
Recent increases in AI-exposed jobs have been led by the capital area. Over the three years since generative AI began to gain traction in 2023, jobs with high exposure to generative AI increased by 247,000, with the capital area accounting for 80.8% (199,000 jobs). Similarly, among the 105,000 new jobs exposed to agentic AI in 2025, 88.3% (93,000 jobs) were in the capital area.
There are also disparities in AI exposure by region. The highest exposure to generative AI is found in Seoul, Sejong, Gyeonggi, and Incheon, while agentic AI exposure is highest in Seoul, Sejong, Gyeonggi, and Daejeon. Conversely, physical AI exposure is concentrated in non-capital regions, with the highest levels in Gyeongsangbuk-do, Jeollanam-do, Chungcheongbuk-do, and Ulsan.
The regional disparities stem from differences in occupational composition and industrial structure. The capital area has a relatively high concentration of office and sales jobs with high exposure to generative AI, as well as managerial and professional roles with high exposure to agentic AI. The proportions of these occupations in the capital area are 20.2%, 8.9%, 1.5%, and 28.1%, respectively, compared to 15.8%, 8.2%, 1.2%, and 18.0% in non-capital regions. In contrast, non-capital regions have a higher proportion of jobs in equipment and machine operation, simple labor, and services.
However, when looking at age groups, the number of workers in generative and agentic AI-exposed jobs has decreased for those in their 20s in both capital and non-capital regions, with no significant differences between the two. This trend is attributed to the focus of higher education on traditional knowledge and information accumulation, making it difficult for young graduates to acquire expertise and experience immediately after graduation.
The Bank of Korea views the spread of generative and agentic AI as favoring the labor market in the capital area. This is due to the concentration of high AI-utilization professional and office jobs, as well as a relatively well-established human and material infrastructure for AI and IT. Consequently, there is a risk that the spread of AI will exacerbate existing labor market disparities rather than alleviate the concentration in the capital area.
Additionally, the relationship between AI and skilled labor could further widen regional gaps. With knowledge service industries and semiconductor manufacturing already concentrated in the capital area, if AI investments also gravitate towards this region, the spatial concentration of industries may strengthen. The proportion of knowledge service workers in the capital area is 71.9%, while semiconductor manufacturing stands at 74.4%.
The Bank of Korea also analyzed that the spread of physical AI could pose new risks to employment in non-capital regions. However, as its current spread is slower than that of generative and agentic AI, the immediate potential for job losses is relatively limited.
Jung Min-soo, head of the Bank of Korea's regional economic research team, stated, "Due to issues such as a lack of physical data, insufficient sophistication, and user trust in physical AI, we believe the spread of physical AI will take time. The job losses due to automation through robots, not physical AI, are already occurring, and the additional impact of physical AI should be analyzed over time."
At the same time, the Bank of Korea noted that while the spread of AI poses risks of widening regional disparities, it also offers opportunities to enhance productivity in non-capital regions. AI has the potential to increase the productivity of low-skilled workers, compensating for a lack of human capital, and promoting the knowledge service transformation of product development and process improvement in manufacturing.
Therefore, the Bank of Korea recommends strengthening AI utilization education in regions, supporting the development of knowledge services and startups linked to key manufacturing industries, and expanding investments through focused efforts to establish regional AI hubs that connect academia, businesses, and government around regional universities.
* This article has been translated by AI.
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