For over two years, AI has been portrayed as a major cause of job cuts, particularly in the tech industry, with US CEOs warning about its potential impact on employment.
A new study from Yale University suggests that the narrative of AI-driven job loss may be more myth than reality.
AI Portrayed As Major Cause of Job Cuts: What’s The Reality?
The Yale report states that fears in Silicon Valley and other tech hubs about AI replacing large numbers of jobs remain speculative.
Yale’s Budget Lab analyzed US job data from the 33 months since ChatGPT was released in 2022, focusing on college graduates and workers at different exposure levels to AI.
The study notes, “While anxiety over the effects of AI on today’s labor market is widespread, our data suggests it remains largely speculative.”
Researchers compared workers with high, medium, and low AI exposure and found no significant changes in employment, indicating AI is not yet a major job threat.
The study compared changes in the US workforce with two historical periods: the rise of computers in 1984 and the internet boom in 1996.
Findings show the labor market’s composition in the AI era mirrors previous technological shifts, suggesting AI is no more disruptive than past innovations.
The study examined recent college graduates (ages 20–24) versus older adults (ages 25–34) and found similar job distributions and career paths, indicating AI has minimal impact on entry-level jobs.
Cooling Job Market, Not AI, Behind Recent Entry-Level Job Disruptions
Recent disruptions in entry-level jobs are attributed to a cooling job market rather than AI.
The study concludes, “The picture of AI’s impact on the labor market that emerges from our data is one that largely reflects stability, not major disruption at an economy-wide level.”
Factors behind job market pressures include the US Federal Reserve ending zero-interest rates in 2022, which previously allowed companies to borrow cheaply for business growth.
Another factor is the growing number of college graduates exceeding available entry-level jobs, a trend that predates ChatGPT.
The Yale study emphasizes that, while generative AI “looks likely to join the ranks of transformative, general purpose technologies,” it is still too early to determine its actual impact on employment.
