AI Won't Steal Your Job: Top Economists Reveal the Surprising Truth About Australia's Workforce

Debunking AI Job Loss Fears

Fears that artificial intelligence will wipe out millions of roles and cause mass unemployment are exaggerated, according to two of the nation’s top economists.

Changing Jobs, Not Eliminating Them

“I don’t think it’s going to cannibalise a significant number of roles or a significant number of people’s jobs, but I do think it’ll change our jobs as we go forward from here,” said Hunter, a chief economist at Westpac.

In recent months, banks have cut call centre staff and tech companies have shed jobs, fuelling fears that AI will cause a spike in unemployment.

Commonwealth Bank in August was the first in the sector to directly link redundancies to AI when it announced it would cut 45 call centre roles because of a new voicebot system it had introduced to answer customer queries.

But it reversed its decision to cut dozens of jobs replaced by artificial intelligence after conceding it still needs humans to meet its growing workloads.

Research Insights from Australia and the US

A recent study in the United States pointed to the first “canaries in the coal mine” from AI. It suggested that employment has been declining for younger workers in AI-exposed occupations since 2022, while employment in other occupations and for other workers has been stable or increasing.

But research this month by the e61 think tank in Australia found these concerns were misplaced locally.

In Australia, youth employment in technology and customer service roles – both widely considered to be highly exposed to AI – have risen since 2022, in both absolute terms and relative to older workers.

“Since 2022, trends in employment and job postings have been similar across occupations with both high and low exposure to AI,” e61 researcher Theo Gibbons said.

The Bigger Picture: Productivity and Living Standards

“It is understandable that public debate is often focused on job losses. However, this zero-sum framing misses the bigger picture of AI’s potential economic effects.

“There will be distributional challenges to manage, but policymakers should not lose focus on AI’s potential to ultimately lift productivity and living standards.”

AI-related companies have driven about 80 per cent of gains in the US stock market this year.

Historical Context and Human Value

Westpac’s Ellis noted that 300 years ago, two-thirds of men in England worked in agriculture and today, 2 per cent do.

“Contrary to the claims of the more tech-oriented commentators, AI does not reduce the value of human labour. Quite the opposite,” she said.

Ellis said that as the range of tasks AI can do expands, the jobs left for humans – those that require a human touch and in-person service – will become more valuable.

“Technical and building trades, along with ‘caring’ occupations where the human touch is so important, are the least impacted,” she said.

Addressing Concerns About Entry-Level Roles

Some have argued that by automating entry-level roles, AI will rob graduates of the basic white-collar training they get from boring, yet educational, grunt work early in their careers.

But Ellis said the educational benefit of these tasks, which she calls “donkey work” given their mundane and repetitive nature, is overrated.

“The amount of ‘donkey work’ needed to teach the new graduates how to be a more senior member of the profession was surely lower than the amount that needed to be done,” she said.