AI has had zero effect on jobs so far, says Yale study

A recent Yale Budget Lab study, corroborated by other research including analyses from the UN and Denmark, concludes that generative AI has had no discernible impact on the US labor market since ChatGPT's November 2022 debut. This finding contradicts widespread concerns from AI company executives and some corporate layoff announcements, which may be more related to cost-cutting. While a Stanford study noted a decline for recent graduates in AI-exposed roles, the prevailing view is that AI has not yet caused significant job displacement, potentially due to enterprise skepticism, suggesting that immediate, widespread labor market disruption from AI is currently overstated.

Analysis

Recent academic research, led by a Yale Budget Lab study, indicates that generative AI has had no discernible disruptive impact on the broader US labor market since the November 2022 debut of ChatGPT. This finding is corroborated by similar studies from the United Nations International Labour Organization and an analysis of Danish workers, which concluded that AI would likely not replace most workers and has had no material impact on wages or jobs thus far. This data-driven consensus stands in stark contrast to the narrative promoted by AI executives and several corporations, including IBM, Salesforce, and Microsoft, which have publicly cited AI amid layoffs. However, the article suggests these corporate actions may be more attributable to traditional cost-cutting, outsourcing, or efforts to appease investors after significant capital expenditures on AI infrastructure. While the prevailing view is one of minimal current impact, potentially due to enterprise skepticism, a Stanford study does introduce a point of concern, noting a 13% relative decline in employment for recent college graduates in occupations most exposed to AI, signaling potential friction in specific labor segments.

Key Decisions for Investors

• Investors should treat corporate announcements attributing layoffs to AI with skepticism, as the underlying driver is more likely traditional cost-cutting, as seen with firms like IBM and MSFT.
• The current lack of broad labor market disruption from AI supports a stable macroeconomic outlook in the near term, suggesting fears of an imminent AI-driven economic shock are presently overstated.