"Artificial Intelligence, Real-Life Consequences"

With the increased growth of Artificial Intelligence (AI) in modern workplaces across various sectors, concerns about its psychological and organizational impacts have become more and more relevant. Whilst existing research often emphasizes the effectiveness and acceptance of AI technologies, there is limited empirical work exploring how AI-related competencies, such as AI literacy and AI self- efficacy, influence broader aspects of employee well-being. This thesis addresses this gap by examining the relationships between AI literacy, AI self-efficacy, work-life balance, and job satisfaction, with particular focus on the mediating roles of stress, perceived job security and AI transparency. An online survey was administered to gather data on these variables, resulting in 177 valid responses collected through personal distribution and survey distribution platforms such as Surveyswap and SurveyCircle. The data was analysed using IBM SPSS, applying multiple regression and mediation models to test hypothesized relationships. The results demonstrate the intricate and indirect pathways through which AI literacy influences employee outcomes. Although AI literacy and AI self-efficacy did not directly predict job satisfaction or work-life balance, several significant mediating relationships were identified. Stress and perceived job security emerged as key elements, mediating the relationship between AI literacy and both job satisfaction and work-life balance. AI transparency also played an important mediating role, though only in relation to job satisfaction. These results suggest that employees' perceptions of stress and perceived job security are critical in shaping how experiences with AI are shaped in the workplace. Notably, job satisfaction was found to negatively predict work-life balance, indicating that higher engagement or commitment to work may come at the expense of personal time. Altogether, these findings underscore the importance of organizational support structures that address stress, perceived job security, and communicate clearly about AI systems in order to foster mental well-being in an increasingly digital work environment.