Neither theory, history nor the latest data suggests a recession driven by AI job dislocation is likely
By Greg Ip. Excerpts:
"Technological advancements always cost some people their jobs—those
whose skills can be easily substituted by tech. But their loss is more
than offset through three other channels. The new technology enhances
the skills of some survivors, who become more productive and better
paid; it helps create new businesses and new jobs; and it makes some
stuff cheaper, increasing consumers’ incomes, adjusted for inflation,
which can be spent on other stuff, generating yet more jobs."
"The ranks of software developers, widely assumed to be acutely
vulnerable to AI, are up 5% in January from a year earlier, a pace
largely consistent with the past 23 years."
"The number of computer programmers, who assist developers in ensuring
code runs properly, was down slightly in the last year, in line with a
secular decline in place for decades. Neither trend shifted much after
ChatGPT’s arrival in late 2022."
"In 2024, the median young computer science graduate earned 63% more than the typical young graduate, up from 47% in 2009"
"business spending on software leapt 11% in the fourth quarter of last
year from a year earlier, the fastest in nearly three years"
"This . . . is in line with previous technological advances that
drive prices down and demand up enough to offset direct job
displacement"
"examples include textile manufacturing in the 19th century, and the spread of ATMs in the 1980s."
"As the number of bookkeepers shrank with the introduction of spreadsheet software in the early 1980s, the number of accountants and financial analysts newly empowered by Lotus 1-2-3 and Excel rose even more."
"Employment of 22- to 25-year-olds in the most AI-exposed occupations
such as software developers and customer-service agents fell 6% in the
three years after the introduction of ChatGPT"
"Radiologists were supposed to lose their jobs to offshoring, and then to
AI. They didn’t, because patients and providers like having humans
around to explain their medical images. Since Google Translate launched
in 2006, the number of human translator and interpreter employees in the
U.S. has risen 73%."
"The money employers or consumers save as AI eliminates jobs doesn’t disappear; it gets spent on something else."