The Churning of the Job Market

Discover how artificial intelligence (AI) is anticipated to disrupt the labor market and how this disruption will impact education.

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The artificial intelligence (AI) revolution is causing what the World Economic Forum describes as “job churn” or “market churn.” This churning describes both a disruption and redefinition of the current workforce.

In some ways, it’s like the effect of a boot stepping into a pool of water. Think of the boot as AI and the sediment at the bottom as millions of jobs. The water is the world that connects and holds a space for all those jobs. When the boot steps into the pool of water and disrupts the environment, all those jobs at the bottom get churned up. They float around for a while before settling into a new place.

That’s what’s happening with AI. It’s disrupting the labor force and churning things up, and while everything is swirling around, employers and employees are trying to figure out where they will land in a job market changed by AI.

Impacts to the Labor Market

While no one can know exactly how the impact of AI will play out, The World Economic Forum’s Future of Jobs Report predicts that this market churn will include a restructuring of about 23% of jobs in the next 5 years. It also predicts that AI will disrupt 44% of existing worker skills during that period as people learn to integrate this new technology in productive ways. The report states that this focus on adaptation will lead to a re-evaluation of skills, with some becoming more important. Specifically, it predicts “cognitive problem-solving moving into the foreground, followed by analytical thinking and technology literacy.”

In his testimony to the U.S. Congress, Sam Altman, CEO of OpenAI, agreed that AI would significantly impact the labor market. He said that he thinks AI technology will “entirely automate away some jobs,” while adding that he also thinks the overall impact will be positive and that AI will create new jobs that his company believes “will be much better.”

There are indications that the AI revolution will impact the labor market differently than past technological advancements.

Previously, major disruptions have almost always impacted blue collar jobs. For instance, production industries were significantly disrupted by the introduction of automation and robotics. Today, robots do much of the work once done by humans, and people have shifted to new roles operating the machines, building and repairing them, or managing the operations.

In contrast, the disruptions caused by AI are anticipated to impact white collar jobs. Kevin Jiang, a reporter for the Toronto Star, calls it out directly, stating, “Automation is coming, and this time it’s for the white collar workers,” even though AI will “likely affect nearly every profession.”

Martin Ford, author of Rule of the Robots: How Artificial Intelligence Will Transform Everything, told the BBC, “In many cases, more educated workers are going to be threatened more than the least educated workers.”

Similarly, Ethan Mollick, AI researcher and professor at Wharton College, points out that “[m]ultiple studies show the jobs most exposed to AI (and therefore the people whose jobs will change the most as a result of AI) are the most educated and highly paid workers, and the ones with the most creativity in their jobs.”

Dhaval Joshi, an economist at BCA Research, points out the underlying reason for this change. In UNESCO’s AI and education: guidance for policy-makers, he says, “The jobs that AI can easily replicate and replace are those that require recently evolved skills like logic and algebra. They tend to be middle-income jobs. Conversely, the jobs that AI cannot easily replicate are those that rely on the deeply evolved skills like mobility and perception. They tend to be lower-income jobs.”

In other words, hands-on, skilled labor jobs are likely the safest from AI because computers (and even robots) cannot perform many of those tasks. On the other hand, jobs that require language use, involve the synthesis of ideas, are repetitive or procedural, or involve the processing of large amounts of information, will potentially be at risk.

In the past, these white collar jobs have been safe from automation because we didn’t have a mechanized way to perform those tasks. AI changes that.

In their article about the future of work, W. Chan Kim and Renée Mauborgne write, “For the first time, humans must grapple with the harsh realization that they no longer have a monopoly on thinking: machines are encroaching on us in a fundamental and existential way. . . . Essentially, we are entering a new era in which the efficacy of technological advances is hitting a tipping point. These advances will increasingly replace a wide range of human jobs with a new labor force like Alexa, Siri, and Bixby, which doesn’t need to check social media, receive a paycheck, take vacations, eat, or even rest.”

In May 2023, The World Economic Forum released its Future of Jobs Report. This comprehensive report synthesized findings from a study of 803 companies spanning 27 industries, 45 economies from all world regions, and over 11.3 million surveyed workers.

According to the study, nearly 75% of companies are looking to adopt AI tech in the next 5 years. Half of these organizations expect this change to lead to job growth, while 25% expect to see job losses. While the impact of AI is likely to be disruptive, this report illustrates that companies believe it has the potential to stimulate positive change and job growth.

An Evolution of Core Employment Skills

As AI churns up the labor market, the skills valued by employers in impacted industries will likely change as well. The Future of Jobs Report identified the core skills that employers believe will experience the most demand in 2023. The top six included:

  • Analytical thinking
  • Creative thinking
  • Resilience, flexibility, and agility
  • Motivation and self-awareness
  • Curiosity and lifelong learning
  • Technological literacy

In addition to outlining desired skill areas, the report also identified job trends. This data can be especially helpful to the educational system as schools re-evaluate the programming they offer students.

The report shows that the jobs expected to see the largest decline were positions that involved repetitive tasks that may most easily be automated by AI. The top positions anticipated to decline were all white color jobs:

  • Bank tellers and related clerks
  • Postal service clerks
  • Cashiers and ticket clerks
  • Data entry clerks
  • Administrative and executive secretaries
  • Material-recording and stock-keeping clerks
  • Accounting, bookkeeping, and payroll clerks

Despite losses in some labor areas, the following jobs are expected to see an increase of at least 25%:

  • AI and machine learning specialists
  • Sustainability specialists
  • Business intelligence analysts
  • Information security analysts
  • FinTech engineers
  • Data analysts and scientists
  • Robotics engineers
  • Big data specialists

Notably, these are primarily white collar jobs. They also require more complex thinking and problem-solving skills than the repetitive tasks of the positions expected to be lost. While requiring a more sophisticated skill set and potential up-skilling, these jobs have the potential to become new opportunities for those whose jobs are replaced by AI.

One of the major roles of the education system is to prepare students for college and career. In the next few years, we will need to consider how artificial intelligence is disrupting the current labor market. Then, empowered with that information, we will need to target the skills that will be most important in an AI-infused workplace and modify our education system so that our outcomes and approaches align with those new targets.

In short, as the world evolves, so must education, and teachers will need to have a strong voice in that conversation.

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