AI Exchanges: AI’s Impact on Employment

To Goldman Sachs Exchanges. I'm Alison Nathan, I'm here with George Lee, co head of the Goldman Sachs Global Institute. Together, we're co hosting a series of episodes exploring the rise of AI and everything it could mean for companies, investors, and economies. George, great to see you again.

You too, Allison. Thank you.

So, George, today we're discussing one of the biggest anxieties, I would say, about the rise of AI, which is the impact on jobs. I would say even prior to the amazing advances in the technology that we've seen over the last few years and that you and I have discussed a lot on this podcast, there have been a lot of questions about the extent to which AI will ultimately replace workers. And if that happens to a large extent, what industries, what roles will be most impacted. It's now been almost three years, though, since we've seen the launch of ChatGPT, which is very hard to believe. Think Tha

Time flies when you're having fun.

But that means that we're actually beginning to see some hard data that I think could finally reveal some answers to these questions. So to that end, I'm excited to welcome my colleague from Goldman Investment Research, Joseph Briggs, who leads our global economics research. He's done some really truly informative and formative work, I would say, on the economic implications of AI more broadly and certainly on this topic. Joseph, thanks for joining us.

Great to be here, Allison. Great to be here, George.

And so, Joseph, before we just dive into all the details, as I just said, we've talked a lot about the advances of the technology. It's come a long way in the last few years, but I think we'd all agree that the adoption is still pretty early. So is it too early to see tangible signs on the labor market?

Yeah. So when we look at adoption, we're currently tracking about 9% of companies in The US using AI for regular production. Now, this number is probably a little bit lower than some of the, you know, more eye popping adoption rates that get picked up in the media. But the definition that we're using when we say 9% is regular production for goods and services over the last two weeks. And I think this is the right definition to keep in mind because it's really what is going to be necessary. Companies using AI in regular production to drive significant productivity impacts. Now, given that adopt

And so when I look at the impact that AI has had on the overall labor market data so far, it looks pretty small to me. Fascinating. I was struck by the 9% number. It feels lower than my intuition. I believe actually that number though, if you weighed it by employment, it's slightly higher. Is that right?