How AI is infiltrating the labor market

February jobs numbers came in hotter than expected Friday, but unemployment ticked up to 3.9%. The gains were uneven across sectors, with AI jobs alone up 42%, revealing increased demand for the technology as adoption spreads.

Kelly CEO and President Peter Quigley joins Yahoo Finance to discuss whether AI is replacing jobs as it infiltrates the labor market.

Citing the World Economic Forum, Quigley states that AI will "create more jobs than it destroys" with the proper use of "guardrails and guidelines." While AI in the workplace could improve productivity, it may leave some jobs exposed, Quigley explains: "Jobs that are going to be impacted, financial analysts, court reporters, anything that tends to be...that has a lot of repetition and a lot of data analytics will be potentially replaced. On the other hand, there are jobs that are going to benefit content writers who no longer have to generate content but will be able to focus on the user interface and the interaction with the end user. "

For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.

Editor's note: This article was written by Nicholas Jacobino

Video Transcript

BRAD SMITH: The February jobs report showing some softening in the labor market with the unemployment rate ticking higher for the first time in four months. But the headline number nonfarm payrolls that actually came in hotter than expected. 275,000 jobs were added during the month. So there's one job area in particular that we want to focus on here. AI as the hype around artificial intelligence escalates. AI jobs alone are showing an increase in demand up 42% since the low in December 2022.

That's according to the University of Maryland researchers. For more on the state of the labor market, we're joined by Peter Quigley, who is the Kelly president and CEO. Peter, great to have you here with us this morning. When we think about where these new roles are going to come about, what the skill sets are? And where this is really taking on some prominence. What are you seeing from what you're tracking in the broader employment situation environment?

PETER QUIGLEY: Well, in terms of AI, specifically?

BRAD SMITH: Absolutely.

PETER QUIGLEY: Yeah. So we're seeing the introduction of AI in almost all of the sectors that we support. Because of the rapid adoption, it took Instagram, I think a year and a half to get to 10 million users. And generative AI took about two months. So I think that's 100 million users actually. So the adoption rate is considerable. There are clearly going to be jobs that are eliminated due to AI challenger gray and Christmas for the first time last May.

And their layoff report cited as a reason for layoffs. But by and large, I think we're going to see more jobs created than we are destroyed, which is a view held by the World Economic Forum. McKinsey printed issued a report and I think that's what we're seeing when we talk to our customers that AI is an opportunity to enable greater productivity, greater engagement, the reduction in routine tasks for their employees.

And that with the proper use of guardrails and guidelines which are very important in the application of AI, I think it's going to overall be a positive for the workforce.

SEANA SMITH: Peter, I'm curious as a staffing agency. What are you hearing from employers? Are they able to find the AI tech workers that they need or want to build that part of the business now?

PETER QUIGLEY: Yeah, clearly not. The number of job openings or job postings that required some artificial intelligence, not just generative artificial intelligence. But this dates back to the 5, 6 years ago. They've tripled. And they're growing exponentially as we speak. A ChatGPT prompt engineer is a job that didn't even exist a year ago.

And yet those jobs are proliferating because companies are finding need to figure out how they're going to apply this technology to improve their business results. We've launched a technology platform at the request of our customers to match individuals with experience and customers that need that. And I think there's going to be more and more of trying to find people who have AI experience to connect with companies whose demand is growing every day.

BRAD SMITH: Right now, it's employees who have AI experience. But then you think further out and all of us in some form or another are going to be either working with an AI Copilot or going to be engaging with some generative AI in one capacity or another in our work. How does this improve productivity? And where does this perhaps leave some roles exposed.

PETER QUIGLEY: Yeah. So the productivity, it really is about reducing routine time consuming tasks. Writing a first draft of something, doing research on some customer or product. Being able to create an agenda and a workday that is most optimized for any particular individual. All of those applications are available today.

In our own business, we found use for creating interview questions for individuals or creating a better job description to match talent with our customers. And those are routine tasks, time consuming tasks that take away from in our world. The recruiting world, connecting our recruiters with the talent they want to place. And I think that is just an analogy for almost any job where AI can replace routine tasks.

Jobs that are going to be impacted, financial analysts, court reporters. Anything that tends to be tax preparers that has a lot of repetition and a lot of data analytics will be potentially replaced on the other hand. There are jobs that are going to benefit content writers who no longer have to generate content. But we'll be able to focus on the user interface and the interaction with the end user.

SEANA SMITH: All right. Peter Quigley, thanks so much for joining us here this morning. CEO and President of Kelly. Thanks.