Advances in AI and automation will force an estimated 11 million American workers to find new occupations over the next decade, but also will add almost quadruple that number of jobs to the economy, new research confirms.
The numbers, laid out by the McKinsey Global Institute in a new report on Tuesday, gives another perspective of the impact on the U.S. labor market-by 2035.
The jobs added aren't really surprising to experts.
MGI's director, Tanguy Catlin, told Barron's that the introduction of new technologies generally lead to long-term job creation driven by the need to support the technologies themselves, but also by the fact that innovation typically increases the standard of living and generates higher demand.
"There is reason for optimism," says Catlin, who is also a senior partner. "Over the course of the next 10 years, there will be more jobs and, on average, better jobs-and that's something that is quite positive."
But these same forces will probably lead to churn in the labor market, reducing demand by about 21% of the current hours worked. That will lead to significant changes in how various jobs are performed.
AI, for example, rarely reduces work without also creating responsibilities in the form of reviewing agent-generated responses and work, and supervising new systems and workflows.
Cashiers, for example, will shift from processing transactions to focusing more customer engagement and supervising AI systems, the team at McKinsey predicts.
Many workers will be displaced entirely. About 770,000 workers are expected to switch occupations each year over the next decade, McKinsey finds. That's roughly 3.6 times the historical average, but not unusual for a period of rapid technological change, Catlin says.
The sectors most vulnerable to layoffs are office and administrative support roles, retail and sales jobs, and transportation and logistics occupations.
Sectors like healthcare, professional and technical services, and construction will probably see the largest growth gains, McKinsey finds.
The pace of adoption, the timing of these changes, and the general economic outlook, however, will determine if the U.S. can balance the job losses with job gains and the migration of the workforce.
Technological revolutions don't occur in vacuums, Barron's has reported. Factors like physical infrastructure, demographics, and the pace of implementation arguably matter more for the labor market and broader economic outcomes than any individual technological advance.
Moreover, McKinsey's research finds that the higher proportion of older Americans, paired with higher incomes and changing spending patterns will also probably lead to new categories of work.
In many periods of technological disruption, there has been a big societal resistance and inertia in moving swaths of people into very different occupations, says Anna Kortis, an MGI partner. That's expected to play out again during the adoption of AI and increased automation.
With many of the new roles expected to require more skills and a greater level of judgment, wages are likely to increase as the workforce is reallocated, the report finds. In fact, the jobs that are more likely to be destroyed are currently lower paying jobs, Kortis says.
For those displaced, the pathways to find new work won't be easy, Catlin says. That's due, in part, to the fact that many of those looking for new occupations will need to learn new skills and probably gain new credentials.
One key factor in how much disruption the labor market-and displaced workers-will accrue lies in how employers reduce those frictions to gain employees.
To be sure, many effects of increased AI and automation haven't been determined yet-and there are changes and shifts in the broader economy that could dramatically impact the course of the labor market over the next decade.
Yet, based on the accumulating research and projections, AI and automation could yield positive developments for American workers.