Workers across various sectors are increasingly anxious about the potential for artificial intelligence (AI) to displace jobs, a sentiment that has gained traction amid warnings from industry leaders and observations from a recent Federal Reserve report. However, new research from Vanguard reveals a contrasting narrative: jobs that are highly exposed to AI automation are actually growing faster than those in less vulnerable sectors, particularly in the wake of the Covid-19 pandemic.
The Vanguard analysis indicates that employment in roles deemed most susceptible to AI, which includes positions such as office clerks, typists, and HR assistants, increased by 1.7% from mid-2023 to mid-2025. This marks a notable uptick compared to a 1% rise during the pre-Covid period from 2015 to 2019. In stark contrast, job growth has slowed across all other occupations, suggesting that AI’s impact may not be as dire as some have predicted.
Adam Schickling, a senior economist at Vanguard, remarked that there is currently no evidence indicating that employment in AI-exposed roles is declining. “At a high level, we have not seen evidence that AI-exposed roles are experiencing lower employment,” he stated in a recent interview. The study evaluated around 140 occupations identified as most vulnerable to AI replacements, focusing on the share of work hours spent on tasks automatable by AI systems.
While the findings present a relatively optimistic picture, concerns remain. Some companies have started eliminating certain positions, leveraging AI to automate tasks traditionally performed by entry-level workers. The Vanguard report acknowledges that while AI may be reshaping workflows, its role in the recent slowdown in job growth is overstated for now.
The analysis also highlighted wage trends, indicating that real wages among occupations with high AI exposure have increased significantly, from just 0.1% pre-Covid to 3.8% post-Covid. Comparatively, occupations less exposed to AI saw a minimal increase in real wage growth, climbing from 0.5% to 0.7% during the same period.
This surge in wages contradicts the narrative that AI could be damaging the job market; if that were the case, one would expect to see shrinking paychecks. Despite the optimism in Vanguard’s findings, a cautionary note is sounded by other experts. Dario Amodei, CEO of Anthropic, has warned that AI could potentially eliminate half of all entry-level jobs in white-collar professions, leading to an unemployment rate as high as 20%.
Moreover, evidence from the Federal Reserve’s Beige Book indicates that some firms are already employing AI to replace entry-level positions, highlighting a growing trend of businesses leveraging technology to enhance productivity. For instance, one manufacturer reportedly reduced its office staff by 15% by implementing AI tools. “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 noted.
Despite the advancements in AI, Schickling emphasizes that the technology still exhibits limitations, particularly with models that are prone to hallucinations or inaccuracies. “It’s clear AI still has limitations,” he remarked, acknowledging that while AI tools are evolving rapidly, they are not yet advanced enough to cause widespread job displacement.
As the landscape of work continues to change, the Vanguard analysis found that the share of workers aged 21 to 25 enrolling in 401(k) plans remains high, suggesting that younger workers are not being disproportionately affected by AI, contrary to some fears. Cisco President Jeetu Patel also weighed in, suggesting that the notion of humans becoming obsolete due to AI is exaggerated. “I reject the notion that humans are going to be obsolete in like five years,” he stated at a recent AI conference.
Looking ahead, experts agree that as AI technology improves, the risk to jobs will grow. Vanguard predicts that professions like customer service representatives, data scientists, and paralegals may face declining demand for human labor due to ongoing advancements in AI. Schickling himself noted that economists might also find their roles increasingly endangered if AI models continue to improve at their current pace.
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