Research reveals AI is ‘not the main driver’ of US job slowdown

A New York Federal Reserve analysis found that AI is not the primary cause of job declines in the US, as hiring trends in AI-exposed sectors like programming and customer service were already declining before ChatGPT’s 2022 launch. Despite tech firms like Cisco, Meta, and Google citing AI as a reason for layoffs, overall hiring rates in early 2024 reached a two-year high, with layoffs remaining low at 0.9% to 1.2%." "article": "A report by the New York Federal Reserve challenges the prevailing narrative that artificial intelligence is the main driver behind job losses in the US. The study examined hiring trends in occupations highly exposed to AI, including programmers, customer service representatives, and data entry roles. Researchers used a metric developed by Anthropic economists to track job vacancies before and after ChatGPT’s release in November 2022. The findings revealed that employment declines in AI-vulnerable sectors began prior to 2022, contradicting the assumption that AI adoption caused a sudden shift in hiring patterns. If AI had disrupted the labor market, researchers expected a sharp divergence in hiring trends between AI-exposed and non-exposed roles starting in late 2022. However, no such shift occurred post-ChatGPT. Despite layoffs at major tech firms like Cisco and Meta being attributed to AI, the overall US labor market showed resilience in early 2024. Hiring rates improved to their highest level in two years, while layoffs remained stable at 0.9% to 1.2%. Goldman Sachs economist Elsie Peng noted that job postings in AI-affected positions have fallen below pre-pandemic levels, but labor market mismatches are decreasing. The report suggests that broader economic factors, rather than AI alone, are influencing employment trends. Companies continue to cite AI as a justification for workforce reductions, yet the data indicates a more complex relationship between technology and job markets.