Working Paper #2026-010
LLM Meets Job Advertisements: Unmasking Skill Premia in the UK
Rapid advances in technology and events such as COVID-19 have significantly transformed the modern workplace, potentially altering the skills demanded in jobs. This study examines the evolving demand and posted-wage premia for Information and Communication Technology (ICT), interpersonal, and Artificial Intelligence (AI) skills in the UK labour market. Using a comprehensive dataset of online job advertisements (2016 to 2022), skills are extracted and categorised via GPT-4 zero-shot learning. Cross-sectional log-wage regressions, incorporating occupation and regional fixed effects with three-way Cameron-Gelbach-Miller clustered standard errors, reveal divergent trends in skill compensation. While interpersonal skills are ubiquitously demanded (approximately 90% of listings), they yield no significant posted-wage premium, likely reflecting their near-universal baseline requirement across postings. In contrast, ICT skills, demanded in approximately 55% of postings, carry a postedwage premium of approximately 7%. AI skills, mentioned in approximately 3% of postings, carry a posted-wage premium of approximately 9% within the ICT-mentioning subsample. These findings document robust associational posted-wage premia for technical competencies amidst recent pandemic-induced and technological labour market shifts.
- Keywords
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- Skills
- Wage premium
- Machine-assisted mixed methods
- Big data
- Large Language Model (LLM)
- COVID-19
- AI
- JEL codes
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- J24
- C45
- O33
Cite this as
APA 7th ed.Rony, S. (2026). LLM Meets Job Advertisements: Unmasking Skill Premia in the UK (UNU-MERIT Working Paper No. 2026-010). UNU-MERIT. https://doi.org/10.53330/QGGU3545