WASHINGTON: The warnings are piling up. In the past week or so Kristalina Georgieva, head of the IMF, has said that artificial intelligence is “hitting the labour market like a tsunami”; Jamie Dimon, boss of JPMorgan Chase, has forecast that America’s biggest bank would soon need fewer employees; and Dario Amodei, who runs Anthropic, has predicted the technology his company is at the forefront of developing could wipe out “half of all entry-level white-collar jobs”.
According to the Economist, AI could indeed wreak havoc in the white-collar workforce. But rather than make such jobs less lucrative—let alone redundant—it is likelier to reshape them. The AI office will look less like a robot and more like a cyborg, combining the best of human and computer capabilities: the Six Million Dollar Man rather than Terminator. To see why, consider what has happened to white-collar work over the past three years, how this compares with earlier technological revolutions and what those patterns imply about what comes next.
For all the alarm, white-collar workers are still doing well. Since late 2022 America has added roughly 3m white-collar jobs—which include management, professional, sales and office roles—while blue-collar employment has remained flat. America has 7% more software developers, 10% more radiologists and 21% more paralegals than three years ago. A slowdown in hiring for some entry-level white-collar work detected by academic research lately appears to predate ChatGPT and so may have more to do with rising interest rates and an unpredictable global business environment.
Professionals’ pay has held up, too. Since late 2022 real (inflation-adjusted) wages in professional and business services (think salespeople, accountants and the like) have risen by 5%. Office and administrative workers earn 9% more. Controlling for education, age, gender, race and other characteristics, we calculate that white-collar workers now earn a third more than blue-collar ones. That is nearly triple the premium in the early 1980s and has kept rising over the past three years. AI has not, in other words, so far robbed office workers of their abiding pay advantage.
When a job was all routine and repetition, it could disappear (as happened with typists). But most professional roles are bundles of tasks, only some of which could be automated. The result was not replacement but upgrading: computers raised productivity and let human effort be directed towards higher-value activities like analysis and judgement. Air-traffic controllers illustrate the pattern: software helped process flight data, humans retained authority over high-stakes decisions, wages rose.
More importantly, by raising productivity and cutting costs, computers also widened the range of activities firms could undertake profitably. E-commerce has generated new work in logistics, supply-chain planning and digital payments. Smartphones created app designers. Social media ushered in digital marketers and influencers.
The result was sustained growth in white-collar employment. According to Daron Acemoglu of the Massachusetts Institute of Technology and Pascual Restrepo of Boston University, roughly half of America’s employment growth between 1980 and 2010 came from the creation of entirely new occupations.
