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AI expected to 'raise the quality' of every job application, economist explains

ZipRecruiter Chief Economist Julia Pollak examines how artificial intelligence can be expected to shake up different job markets, the most and least vulnerable types of jobs, automation trends, and how job seekers can benefit from using artificial intelligence in the application process.

Video Transcript

[AUDIO LOGO]

SEANA SMITH: The buzz surrounding AI is only getting louder. But what does it mean for jobs? Airbnb CEO Brian Chesky and US Commerce Secretary Gina Raimondo weighed in on this exact topic on Yahoo Finance earlier this week.

BRIAN CHESKY: The nearest term impact it's going to have is it's going to make everyone in tech companies more productive. Software engineering will be more efficient because computer programming is a language. And now, suddenly, these tools can, in some ways, do development just as good as a person, in some cases, better than a person.

GINA RAIMONDO: There is no question that AI will change the way we work. And in many ways, that will be a good thing. It will make our jobs easier. It will make us more effective. It will make us more productive. But it's also true that it's a brand new technology that's very powerful. And that's why we have to be thoughtful to make sure people don't get hurt.

SEANA SMITH: Let's talk a little bit more about this with ZipRecruiter Chief Economist Julia Pollak. Julia, it's great to see you again. So IBM, we heard this week, planning to replace almost 8,000 jobs over time because of AI. How do you see AI disrupting the workplace?

JULIA POLLAK: So, traditionally, new technologies have come online and made the most educated, highly skilled workers more productive and replaced lower skill, low-wage workers. This time around, things could be very, very different with generative AI actually disrupting many highly paid white-collar jobs in legal services, accountants, teachers, what have you, HR staff, back office staff, administrative staff, et cetera, et cetera.

And it's the kinds of jobs that are fairly low-wage jobs, that are very manual that are not at much risk at all. It's janitors and gardeners, it's maintenance technicians who are at very little risk of this technology.

AKIKO FUJITA: You know, people hear more productivity, more efficiency. And, automatically, it becomes, well, here are the job cuts coming because of AI. But we've also heard the argument-- no surprise from tech companies who say there's a lot of job creation on the other end. What are some of those jobs that you're looking at?

JULIA POLLAK: Well, the first exciting sign to come out from this technology is a study that was just released about the effect on productivity of customer support agents, among 5,000 customer support agents in a Fortune 500 company. And what actually happened there was that AI tools, ChatGPT-style tools raised productivity for the youngest, newest, least experienced workers the most. It gave them a script. It showed them examples, and it got them up to speed much more quickly.

And so that is very encouraging news for employers in these very supply-constrained industries right now, who are struggling to fill vacancies and who are very nervous about reducing their standards and hiring workers with less experience and less education than they used to. But this new evidence from MIT and Stanford suggests that, actually, perhaps there isn't as much of a supply constraint in the labor market. Perhaps we can hire younger people and get them up to speed very quickly.

SEANA SMITH: Julia, how do you see this really impacting those who are just graduating from college? And in terms of the trends that you're seeing there at ZipRecruiter, how many of these recent college graduates are thinking about AI and its impact on jobs?

JULIA POLLAK: So new graduates tell us that most of them used it for their college homework at some point. Even though it's a relatively new technology, they jumped right in and adopted it. About 70% are using it for their job search to discover different jobs, to write a resume.

So they are very upbeat about this technology. They're not too worried about it replacing them. And they're already finding ways to become more effective and more productive.

AKIKO FUJITA: What does it mean for the hiring process? I mean, we know for years, that businesses have used AI as a way to sort of weed out the initial phase of the hiring process, maybe trying to find the right candidates to interview. I'd imagine with the latest developments, that's only going to be accelerated. What are you looking at in terms of what this is likely to do for that process?

JULIA POLLAK: Well, I expect that it's going to raise the quality of every application. If you can just take a terrible selfie on your phone and have it turned into a beautiful corporate headshot, if you can answer a couple of questions and have a beautiful resume, every job seeker, every candidate is going to start looking amazing. And that is going to push employers to want to have instant connection with a real human to see who you really are.

If the signal is lost in your resume, employers are going to have to look for something else. And I think they're going to go back to the old-fashioned, person-to-person contact.

SEANA SMITH: Julia, what are you hearing from the employer side of this? Because when it comes to the labor shortage-- and you touched on it briefly earlier-- have we made tremendous amount of stride there? Are employers able to find those skilled workers that they need? And how does AI play into that?

JULIA POLLAK: Absolutely not. In the consumer services industries where employers are adding lots of jobs, there are still very, very high churn and very, very high wage growth pressures. And there are very few candidates. And this is going to be a long-term issue.

The working age population in the United States is not growing anymore. The share that are college educated is growing. And so we're going to run out of noncollege educated workers prepared to do these jobs.

And AI is probably not going to help that much. So employers in those areas need to understand that this is going to be a tough slog. And they need to make these jobs more attractive.

On the other end, you're seeing companies like IBM pausing hiring and replacing HR jobs and accounting jobs and legal services jobs with AI. But there's still likely to be very little shortage of demand for highly educated workers in the United States. We know this is a growing economy. And this jobs report today, I think, suggests that we are really at a ceiling, that the longer the expansion goes on, the more and more jobs are created.

AKIKO FUJITA: ZipRecruiter's Julia Pollak, appreciate you joining us on this Friday. Have a good weekend.

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