The surprising truth about AI’s impact on jobs

By Matt Egan, CNN

New York (CNN) — Many workers fear artificial intelligence is coming for their jobs, an idea bolstered by warnings from AI leaders and anecdotes from a recent Federal Reserve report.

Yet new research finds the opposite is true – at least for now.

Jobs that are highly exposed to AI automation are growing faster than they did prior to Covid-19 – even faster than all other occupations, according to Vanguard.

The findings don’t necessarily signal an all-clear for workers worried about AI disrupting their careers. Some companies have recently reported they’re eliminating some positions because AI can automate entry-level workers’ tasks or make current workers more efficient.

Yet there’s no evidence the technology is doing widespread damage, at least not yet.

“At a high level, we have not seen evidence that AI-exposed roles are experiencing lower employment,” Adam Schickling, senior economist at Vanguard, told CNN in a phone interview.

The Vanguard analysis focused on roughly 140 occupations it deemed the most vulnerable to getting replaced by AI, including office clerks, typists, HR assistants, law clerks and data scientists.

These are jobs with the highest share of working hours performing tasks that AI systems could potentially automate with a high degree of autonomy.

In other words, these are the positions likeliest to shrink as AI explodes.

But that’s not happening. Not necessarily because AI isn’t a long-term threat to jobs, but because the tech just isn’t quite good enough yet.

AI-exposed jobs are growing

In fact, Vanguard found that employment among the occupations with high AI exposure increased by 1.7% during the post-Covid period of mid-2023 to mid-2025.

That’s a faster pace for these jobs than the 1% increase during the pre-Covid period (2015 to 2019).

By contrast, job growth has slowed for all other occupations, according to Vanguard.

Schickling said he purposely didn’t compare recent job trends with the 2020-2022 period because that was a very unusual time in the job market, making it an inappropriate baseline.

Wages are up, too

Vanguard found similar results for wages.

Occupations with high AI exposure experienced real wage growth (adjusted for inflation) of just 0.1% pre-Covid, according to Vanguard. But that has accelerated to 3.8% in the post-Covid period.

By comparison, all other occupations less exposed to AI have enjoyed a smaller acceleration in real wage growth, going from 0.5% pre-Covid to 0.7% post-Covid.

This finding is surprising. If AI were really damaging the job market, it should show up by shrinking paychecks.

“While AI may have started to change our workflows, its role in explaining the recent slowdown in job growth is overstated,” Vanguard said in the analysis.

‘We can’t just sleepwalk into it’

All of this data contrasts with the doomsday warnings from some economists and CEOs – including AI leaders.

In May, Anthropic CEO Dario Amodei warned AI could eliminate half of all entry-level jobs in white-collar professions, spiking the unemployment rate up to 20% in the near future.

“It’s eerie the extent to which the broader public and politicians, legislators, I don’t think, are fully aware of what’s going on,” Amodei told CNN’s Anderson Cooper. “We have to act now. We can’t just sleepwalk into it.”

Even some Federal Reserve research shows AI is starting to impact the job market.

For instance, the November Fed Beige Book, a compilation of anecdotes from businesses across the country, said “a few firms noted that artificial intelligence replaced entry-level positions or made existing workers productive enough to curb new hiring.”

By leaning on AI tools and automation, one manufacturer slashed the size of its office staff by 15%, the Cleveland Fed said.

“Many contacts noted that even modest deployments of AI would enable them to not refill some jobs or to skip a recruiting class of entry-level workers,” the Philadelphia Fed wrote in the Beige Book.

Pressure on entry-level workers

The Vanguard analysis zoomed in on entry-level workers, a group that has faced an increasingly difficult time finding work in today’s job market.

If AI were disproportionately hurting younger workers, it would show up in Vanguard’s internal data on the 5 million participants in the 401(k) plans the company administers.

But Schickling said that’s not the case. The share of workers aged 21 to 25enrolling in Vanguard 401(K)s remains relatively high.

Some tech leaders have pushed back on the pessimism about AI stealing jobs.

Cisco President Jeetu Patel told CNN in August the “stupidest thing a company can do” in the long run is refusing to hire entry-level workers because of AI.

“I reject the nation that humans are going to be obsolete in like five years, that we’re not going to have anything to do and we’re going to be sitting on the beach,” Patel said at Ai4, an AI conference in Las Vegas.

AI still has limitations – for now

So why isn’t AI playing a bigger role in today’s soft jobs market?

Schickling said it could be because some AI models still struggle with issues like hallucinations.

“I am perpetually surprised and amazed with AI’s capabilities – but also with how wrong these models can be at times,” he said. “It’s clear AI still has limitations.”

Of course, the risk is that as AI tools advance at lightning speed, so will the danger to human jobs. Schickling acknowledges there will be some job disruption.

For instance, Vanguard expects customer service representatives, data scientists, paralegals and other professions to suffer lower demand for human workers due to the technology.

Among the occupations most exposed to AI? Economists.

“If models continue to make exponential improvement, that could be a bigger threat to me personally,” Schickling said.

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