Artificial intelligence could increase economic growth across Europe but may also deepen existing economic pressures, with its benefits and costs likely to be distributed unevenly among countries, regions and workers.
Greater integration of the European Union’s single market could help spread AI adoption and its economic benefits more evenly across the 27-member bloc.
Around 60% of workers in advanced European economies are employed in occupations that are highly exposed to AI. While AI tools could improve productivity in some jobs, increased automation could also displace workers in occupations where technology is more likely to replace labour rather than complement it.
The rapid expansion of AI is also expected to increase electricity demand. Data centres currently account for about 3% of Europe’s electricity consumption, with demand projected to rise significantly as AI adoption expands.
Major technology hubs, including Frankfurt, London, Amsterdam, Paris and Dublin, are particularly exposed to rising power demand, as data-centre clusters are already placing pressure on local electricity networks.
Greater investment in cross-border power grids and deeper integration of European energy markets could help address the growing demand for electricity linked to AI development.
Europe also faces the risk of becoming increasingly dependent on foreign AI technology, as the United States and China currently dominate the development of advanced AI models. Developing a stronger domestic AI industry would require significant investment to reduce reliance on external technologies.
The economic gains from AI are also expected to vary across and within EU member states. More advanced economies could benefit more because they have greater exposure to AI and are better prepared to adopt the technology.
The uneven impact of AI highlights the need for policies that support investment, workforce adaptation, energy infrastructure and broader access to the technology across Europe.
