Artificial intelligence’s impact on the labor market

Artificial intelligence is beginning to change the labor market. Many industries are already seeing a shift in reorganizing production, reallocating tasks and hiring. Those going into the workforce are concerned about the replacement of human workers and what this means for labor supply and demand.

Domenico Ferraro, an assistant professor at ASU’s W. P. Carey School of Business, joined “Arizona Horizon” to discuss the concern in AI’s role in the changing market.

Ferraro, in a research paper he wrote, says that AI is “reorganizing” the work force rather than eliminating work altogether.

“This doesn’t mean recent college graduates are not going to face risk of disorganization. But it did assess that even if the risk is there, seems to be small. So, there is a reorganization of the workplace leads into a organization of production process and task,” Ferraro said.

Moreover. Ferraro believes that a more optimistic view when it comes to the effect of AI on the workforce is for it to be means to boost productivity.

Further into his research paper, Ferraro notes that AI cannot simply replace jobs but rather tasks within a job.

“Some of them could be automated by artificial intelligence, but still most of those tasks can be carried out by us human beings. How? Because the creativity and the validation and the quality of prompt remains key to use AI,” Ferraro said.

Teaching students in their universities and other schoolings about AI is a way that Ferraro believes those seeking their first jobs out of school can best prepare for the ever changing workforce.

“There is a risk in the short run but in the long run, I think the demand for labor, even at the entry level, is going to go up,” Ferraro said.

Domenico Ferraro, assistant professor, W. P. Carey School of Business, ASU

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