Good News on AI and Jobs

Will AI cause mass unemployment? Alarming news headlines and social media conversation often give that impression. But economists tend to be more sanguine. They know that while technological advance can certainly disrupt labor markets, the long-term trend is that tech progress creates more than it destroys. Aided by our machines, economies always find plenty of new things for workers to do. So the results of a new survey of economists isn’t surprising, although they’re certainly a bit reassuring to see. Last month’s CfM-CEPR survey of around 30 economists produced the following findings:

• “Most of the panel . . . believes that AI is unlikely to affect employment rates in high-income countries, with the remainder split between predicting an increase and a decrease in unemployment rates.”
• “Most panelists think that AI is likely to boost global growth to 4 percent to 6 percent annually (relative to an average of 4 percent over the past few decades).”
• “Notably, most panelists indicate a great degree of uncertainty regarding their predictions, because AI is still in its infancy.”

Given the public’s apparent concern about job loss, here’s more on what the economists had to say concerning that issue:

Most panellists believe that AI developments are unlikely to impact unemployment in high-income countries over the long run. Michael Wickens (Cardiff Business School and University of York) cites previous technological changes to support this stance: “The number of jobs and the level of unemployment will not change but the number of hours of work will fall and leisure increase. This is what has happened following past tech[nological] improvements. The same thing will happen with AI.” Echoing this view, Cédric Tille (The Graduate Institute, Geneva) states that “unemployment effects may be limited” but notes that “the impact on income inequality and need for redistribution policy may be large”. Maria Demertzis (Bruegel) argues that the impact of unemployment could depend on reskilling, stating “the quicker this [reskilling] happens, the less the impact on unemployment”.

Of course, if AI really is an important general-purpose technology—and the global growth predictions suggest the economists think it is—then there will be big job impacts. But they will be the sort of impacts that automate some parts of jobs even as they also make us more productive at other parts, while also creating new tasks. Big changes, just not ones that put workers on the unemployment line. Destruction of tasks rather jobs, all of which equal dynamic disruption—exactly what should happen in a healthy economy. And while the optimists could be wrong, my working assumption is that economic history remains a perfectly serviceable guide, at least for now.