AI and the Job Market

Artificial intelligence (AI) is rapidly reshaping the job market, with increasing evidence that widespread job displacement is already underway. While many people still resist acknowledging this shift, recent data points to a future where countless jobs could be replaced by AI, especially in tasks where efficiency gains are prioritized. Early studies, despite focusing on somewhat outdated models, indicate that 5% of U.S. jobs have already been impacted, with projections suggesting far more significant effects as advanced AI systems are adopted. Companies like BT and Klarna are planning large-scale workforce reductions in favor of AI, while experts estimate that up to 800 million jobs could be affected globally by 2030. Although there's debate over the extent of economic growth AI may generate, a consensus is emerging: the labor market will never be the same, and societies must urgently prepare for these transformations.

AI and the Job Market: What to Expect in the Near Future

AI will replace most professions and make countless people unemployed. This fact is still denied by most people today. Be it out of fear of unemployment and concern about the financing of survival, be it because they identify so strongly with their wage labor that the loss of a job would be synonymous with the loss of their own existence.

Of course, the question arises as to what is meant by AI, since AI is a broad field and does not exclusively refer to LLMs.

In this article, I will empirically prove that the mass loss of jobs is not a fantasy and not something that will happen in the far future, but has already begun. In doing so, it is important to me to include verifiable sources so that everyone can check the theses I have put forward for themselves.

It is in the nature of things that all data refers to past years. Studies regularly take a year from start to publication. In the age of AI, that's almost an eternity. So it's not surprising that all the following figures and data refer to models that are already outdated. Neither the OpenAI model o1, which represented a significant leap in quality, nor newer models than GPT-4, nor AI editors like Cursor, which already significantly simplify coding today, nor significantly improved diffusion models or other creative models that could make creative professions redundant (Midjourney, Sora, NotebookLM...), have been included in the studies. In short, the studies are largely based on data from 2023. In this respect, they are indeed meaningful, but they distort the result, since an immense amount has been developed and improved in the field of AI between 2023 and today, so that one can assume the acceleration of unemployment has increased - but this remains primarily a thesis for the present. Nevertheless, it is important to me to provide an initial analysis of the connection between artificial intelligence and unemployment based on empirical material.

Empirical Data: What Influence Does AI Have on the Global Labor Market?

As mentioned at the beginning, most of the data is from 2023, when the latest model was GPT-4. Now, we have a wide variety of models that affect a wide range of work areas, but were still in development a year ago. Therefore, the following data should be treated with a certain amount of caution.

I have done the best research I could on the social structure of unemployment in the context of artificial intelligence. So far, there have been a few studies, but I would have liked a better data set to make a valid and meaningful statement. Therefore, I decided to repeat this study in 2025 with the data from 2024.

Nevertheless, let's see what we have been able to find so far.

The website seo.ai has summarized the state of 2023 in a graphic and analyzed various segments of the working world in the context of AI. As a first approach to the topic, a look at this table is helpful.

Most of the data comes from an IBM study. Three aspects are particularly noteworthy. 

1. Robotics has always led to job losses and does not necessarily have to be read in the context of AI. According to my review, the first statement of the table above is not very convincing. Nevertheless, I think that robotics will play an essential role in displacing workers in the future, because modern robotics with AI is developing a qualitatively different productive force than “old” robotics.

2. The figures primarily show a level of concern and emotion with perception and perspective. In the studies, C-level Management repeat that they want to save human labor in favor of AI in the future. This is ultimately rooted in the economic system. Under capitalism, companies are forced to give into the pursuit of profit in the competitive struggle; AI is cheaper and more efficient than human labor, so it will replace it. Workers themselves are already feeling the effects of this displacement policy on the labor market and are therefore statistically significantly worried about their future in the world of work.

3. However, reliable, empirically valid and well-founded data can also be found in the table and the corresponding source. According to a study by Challenger Gray, 5% of the human workforce in the US was already replaced by AI in May 2023.

5% represent a turning point for the labor market in 2023. Not least due to the rapid spread of ChatGPT 3.5, many companies have already started to integrate AI into their work processes, as a graph from the IBM study shows for 2022. It should be noted, however, that AI is very undifferentiated and that the research often does not clearly distinguish between the different AI models (unfortunately, in numerous studies, AI is equated with LLMs and chatbots).

It is therefore not surprising that similar figures continue to this day. According to a study by resumbilder.com, the value of AI use in companies will increase significantly by 2024:

"53% of companies use AI and 24% plan to start using it in 2024.

37% of companies that use AI report that the technology has replaced workers this year.

44% of organizations surveyed say AI will lead to layoffs in 2024

96% of organizations hiring in 2024 say job candidates will benefit from AI skills

83% say AI skills will help current employees keep their jobs”

But in addition to percentage forecasts, there are also concrete figures for how, in particular, joint-stock companies see their future prospects and how they are using AI to reduce their workforce.

“FTSE 100-listed BT [British Telecom] is one of the first major global companies to outline just how many staff will be affected by the AI revolution.” BT expects to be able to replace 10,000 jobs with AI within seven years. Another stock-market listed company in Europe, the financial services provider Klarna, is going one step further and recently announced that it would replace “more than half of its 5,000 employees with artificial intelligence”.

A study from 2023, well before the release of OpenAI's o1, estimated that almost 20% of all workers are influenced by AI for at least 50% of their total work:

In an analysis for the International Journal of Scientific Research in Engineer Management, Rudra Tiwari has projected that by 2023, 14 percent of the global workforce will have to leave or change their jobs due to AI – assuming they are needed in an alternative job. 14% corresponds to 375 million employees.

Tiwari is referring here to studies by the management consultancy McKinsey, the World Economic Forum and numerous other scientists, who go even further in their projections.

The results of a study by PWC, one of the world's largest management consultancies, are also plausible: 25% of all CEOs surveyed attribute 5% of all job losses to automation by AI as early as 2024.

“One in four CEOs expect generative AI to lead to job cuts of 5% or more in 2024” (PwC)

The World Economic Forum, in turn, predicts that 7.5 million data entry jobs will be lost globally by 2027 as a result of automation through AI.  

Thus, a very clear picture has emerged so far. Both management consulting and surveys among managers, as well as the perception of the workforce, all point in one direction: AI will displace jobs. It is not clear to what degree (as the analyses differ widely), but the overall trend remains evident.

Interim Conclusion

The data is still poorly structured and you have to gather the results together. But the tenor is clear: all studies show that AI is either already displacing many jobs today or will at least do so in the future. I couldn't find any study that sees it quite differently.

However, there are significant differences when it comes to the question of how strongly AI will affect the global economy. Daron Acemoglu, the most recent winner of the Nobel Prize in Economic Sciences, assumes that AI will only lead to economic growth of 1 to 1.5 percent, while Goldman Sachs and the management consultancy McKinsey predict significantly higher values.

But there is consensus that AI will change or displace jobs. The only question is how much and with what consequences.

As I said at the beginning, technological progress in the field of AI is developing rapidly. Models are beginning to improve themselves (AlphaChip), and reasoning models like o1 have a much greater influence on science and the labor market than earlier LLMs like GPT-4, which hallucinate a lot more.

If we look at further predictions, such as that made by former Google CEO Eric Schmidt that either this year or next, the limits of context windows will be exceeded, and then look at the abilities that general agents already have today, then there is no way of knowing where we will be in a few years and what the impact on the world of work will be. Accordingly, as I mentioned at the beginning, I will repeat the analysis in 2025 to see how the data has changed and adapted. But until then, we can safely say that AI will have a significant impact on jobs worldwide and will destroy jobs. There is agreement on this. The only disagreement is about how strong this influence will be.

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