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Title: Gen AI Is Not Replacing Jobs Or Hurting Wages At All, Say Economists

Link: https://news.slashdot.org/story/25/04/29/2341...

An anonymous reader quotes a report from The Register: Instead of depressing
wages or taking jobs, generative AI chatbots like ChatGPT, Claude, and Gemini
have had almost no wage or labor impact so far -- a finding that calls into
question the huge capital expenditures required to create and run AI models.
In a working paper released earlier this month, economists Anders Humlum and
Emilie Vestergaard looked at the labor market impact of AI chatbots on 11
occupations, covering 25,000 workers and 7,000 workplaces in Denmark in 2023
and 2024. Many of these occupations have been described as being vulnerable
to AI: accountants, customer support specialists, financial advisors, HR
professionals, IT support specialists, journalists, legal professionals,
marketing professionals, office clerks, software developers, and teachers.
Yet after Humlum, assistant professor of economics at the Booth School of
Business, University of Chicago, and Vestergaard, a PhD student at the
University of Copenhagen, analyzed the data, they found the labor and wage
impact of chatbots to be minimal. "AI chatbots have had no significant impact
on earnings or recorded hours in any occupation," the authors state in their
paper. The report should concern the tech industry, which has hyped AI's
economic potential while plowing billions into infrastructure meant to
support it. Early this year, OpenAI admitted that it loses money per query
even on its most expensive enterprise SKU, while companies like Microsoft and
Amazon are starting to pull back on their AI infrastructure spending in light
of low business adoption past a few pilots. The problem isn't that workers
are avoiding generative AI chatbots -- quite the contrary. But they simply
aren't yet equating to actual economic benefits. "The adoption of these
chatbots has been remarkably fast," Humlum told The Register. "Most workers
in the exposed occupations have now adopted these chatbots. Employers are
also shifting gears and actively encouraging it. But then when we look at the
economic outcomes, it really has not moved the needle." Humlum said while
there are gains and time savings to be had, "there's definitely a question of
who they really accrue to. And some of it could be the firms -- we cannot
directly look at firm profitability. Some of it could also just be that you
save some time on existing tasks, but you're not really able to expand your
output and therefore earn more. So it's like it saves you time writing
emails. But if you cannot really take on more work or do something else that
is really valuable, then that will put a damper on how much we should
actually expect those time savings to affect your earning ability, your total
hours, your wages." "In terms of economic outcomes, when we're looking at
hard metrics -- in the administrative labor market data on earnings, wages --
these tools have really not made a difference so far," said Humlum. "So I
think that that puts in some sense an upper bound on what return we should
expect from these tools, at least in the short run. My general conclusion is
that any story that you want to tell about these tools being very
transformative, needs to contend with the fact that at least two years after
[the introduction of AI chatbots], they've not made a difference for economic
outcomes."

Read more of this story at Slashdot.

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