AI is widening pay and job gaps between workers, new analysis says

In short: New reporting and research suggest AI is increasingly rewarding high-skilled workers and owners of AI systems, while putting pressure on entry-level and many middle-class jobs.

What's going on

AI-related skills are showing up as a clear advantage in the job market. Workers in jobs that ask for AI skills earn about 56% more than similar jobs that do not list AI requirements. Separate findings also suggest that employment for workers over 30 in high AI-exposure roles has grown by about 6% to 12%.

The biggest hit appears to be at the start of the career ladder. A Stanford University study found AI reduces entry-level tech jobs by 13%. The concern is that AI can quickly take over many starter tasks, which can make it harder for young people to get that first “real” job where they learn on the job.

Some economists describe a squeeze in the middle. IMF Managing Director Kristalina Georgieva compared AI’s impact to an “accordion” that opens for some people and not others. IMF research suggests that jobs not helped by AI are starting to pay less compared with AI-enhanced jobs, which can lead to stalled wages for many middle-class workers.

There can be spillover benefits. One study in San Francisco found each new local tech job was linked to 4.4 more local jobs, including roles like retail clerks, cooks, teachers, and dentists. But critics say this does not solve the bigger issue of who captures most of the gains, especially since AI often requires expensive computers, large amounts of energy, and lots of data (information used to train systems).

What to watch

Leaders at institutions like the European Central Bank and the World Economic Forum are calling for policies that focus on how AI-driven wealth gets shared. Another open question is whether AI stays concentrated in richer countries, which the WTO warns could deepen global inequality.

Source: NYTimes