Ireland ranks fourth globally for AI engineering talent concentration and net AI talent migration, according to the latest Labour Market Pulse report published by IDA Ireland in collaboration with Microsoft and LinkedIn.
The 12th edition of the report, published ahead of Ireland’s International AI Summit, finds that the country is entering the AI transition from a position of strength, despite a slowdown in hiring across international markets.
LinkedIn data shows that 1.31% of its members in Ireland are classified as AI engineering talent, placing the country behind Israel, Singapore and Luxembourg but ahead of Germany, the UK and France.
Ireland also ranks fourth globally for net AI talent migration and first in the IMF Skills Readiness Index.
Employment in Ireland reached 2.84 million in the second quarter of 2026, an increase of 1% year on year, while unemployment remained at or below 5.1% for 54 consecutive months.
Hiring has moderated, but Ireland has proved more resilient than some European counterparts.
The LinkedIn hiring rate for Ireland fell by 6.7% year-on-year in September, compared with declines of 11.3% in the UK and 18.1% in Germany.
The report found no clear evidence that the overall hiring slowdown was concentrated in jobs most exposed to AI or was disproportionately affecting entry-level recruitment.
Entry-level hiring fell by 8.3% year on year in September, broadly in line with the 6.7% decline in overall hiring.
However, some emerging risks warrant attention. Entry-level hiring in AI-augmented occupations declined by 16.2% year-on-year in the second quarter of 2026, compared with a 10.8% decline across those occupations overall.
Within software engineering and data analysis, the report identified signs of a sharper pullback in junior recruitment, although it said the extent to which AI was driving the trend remained unclear.
Central Statistics Office Labour Force Survey data also pointed to weaker outcomes for younger workers in some sectors, particularly ICT services.
Demand for AI skills continues to grow. The share of LinkedIn job postings in Ireland requiring AI engineering skills increased by 29% between 2019 and 2025. AI engineer, machine learning engineer, data annotator, analytics specialist and data analyst were the five fastest-growing AI occupations in Ireland in 2026.
Ireland also ranked first in Europe and third globally for AI diffusion, measured by the share of the working-age population using generative AI, according to Microsoft’s latest Global AI Diffusion report.
Microsoft Ireland’s Work Trend Index found that 63% of Irish workers now use AI tools at work, while 76% view AI as a major economic opportunity for the country.
AI investment is also creating opportunities for employment and innovation. Digital and AI investment accounted for 40% of global greenfield foreign direct investment in 2025, while AI and its supporting infrastructure created 1.3 million jobs globally between 2023 and 2025.
IDA client companies committed €2.5 billion across a record number of research, development and innovation investments in 2025, with around two-thirds of supported projects involving AI.
Dublin ranked fourth among European cities for AI-related foreign direct investment projects, attracting 25 since 2025.
Employment across IDA Ireland’s client base grew by 1.5% in 2025, while job losses as a share of total employment fell to a 10-year low of just over 4%.
“The latest Labour Market Pulse shows that Ireland enters the AI era from a position of real strength. Even as hiring has moderated internationally, employment across IDA’s client base grew in 2025,” Lohan said.
He added: “Ranking fourth in the world for AI talent sends a powerful signal to investors, and our focus now is on building on that advantage through continued investment in talent, infrastructure and adoption.”
James O’Connor, Microsoft Ireland site lead and corporate vice-president of Microsoft’s global operations service centre, said Ireland’s adoption of AI presented opportunities for businesses and public services but required continued investment in skills.
“To fully harness that opportunity, we need an all-of-society approach to skills, so that every worker and every business, from start-ups and SMEs to our largest employers, can use AI responsibly and effectively,” O’Connor said.
He said government, industry and education needed to continue working together to support the National Digital and AI Strategy.
Microsoft had invested more than €12 million in developing and delivering STEM and AI skills programmes since 2018, he added.
Patryk Goron
Ltd
